California storage bill would allow judge to order release of vehicle on bond for excessive storage fees

The California Autobody Association (CAA) is asking that registered auto body shops in the state be excluded from a newly filed bill intended to combat “bandit towing.” 

SB 1112 authorizes the legal owner, lienholder, or insurer of a vehicle in the possession of a towing company or storage facility to initiate judicial proceedings in small claims court to determine whether a vehicle was wrongfully taken or withheld, or whether the storage charges include excessive or unreasonable fees.  

It would authorize the registered owner to post a bond or adequate security with the clerk of court where the vehicle is stored. It would set a maximum bond of $6,250 if the owner is a company or up to $500 if the vehicle owner is an individual. 

The court would issue a certificate directing the release of the vehicle from the towing company, impound yard, or storage facility. 

The bill goes on to say that auto body shops, impound yards, and storage facilities shall not knowingly participate in or profit from unauthorized or deceptive towing practices where a vehicle is wrongfully taken or withheld. It says the businesses will be subject to a civil fine not to exceed four times the amount charged to the vehicle. 

It also says that businesses, including auto body shops, shall post a notice visible to consumers stating a consumer’s right pursuant to the bill. The businesses are subject to a fine if they fail to comply, the bill says. 

The bill exempts any vehicle towed by the California Highway Patrol to an approved towing company storage facility or impound yard. 

Jack Molodanof, CAA attorney, wrote the sponsor of the bill, Sen. Bob Archuleta (D-30), last week, asking that automotive repair dealers registered with the Bureau of Automotive Repair (BAR) that receive vehicles for diagnostics, estimates, storage, or repair services at the request of the vehicle’s owner or the owner’s authorized representation be exempt from the bill. 

He said the bill appears to target fraudulent or unlawful towing practices carried out by bad actors and is not intended to regulate legitimate automotive repair businesses. He notes that consumers typically choose to have their vehicles towed to legitimate repair shops. 

“Applying this bill to these businesses would not further its intended purpose and could instead impose unnecessary and burdensome requirements on legitimate automotive repair facilities,” he writes. 

Molodanof adds that BAR is currently finalizing a regulation to govern storage practices. 

“Without clarification, the bill could inadvertently impose duplicative or unnecessary requirements on fully regulated, compliant businesses that are not engaged in the misconduct the bill seeks to address,” he writes.

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