625 ILCS 5/3-117.5

(625 ILCS 5/3-117.5)

Sec. 3-117.5. Automatic processing of applications for salvage or junking certificates; salvage dealer; bond.

(a) Notwithstanding any other provision of law to the contrary and subject to the requirements of this Section, if a salvage dealer as defined under Section 3-117.3 posts annually a bond in the amount of $100,000, up to a maximum aggregate amount of $100,000, with the Secretary of State, the Secretary of State shall automatically process any properly submitted application by the salvage dealer for a salvage certificate or junking certificate pursuant to Section 3-117.1 and issue the appropriate salvage certificate or junking certificate.

The Secretary of State Vehicle Services Department may conduct random samplings of automatically processed applications submitted by a salvage dealer under this Section to ensure that the salvage dealer's applications for salvage certificates or junking certificates are accurate.

Applications for salvage certificates or junking certificates submitted by a salvage dealer that are not accompanied by the most current certificate of title are not eligible for automatic processing, including, but not limited to, applications accompanied by an affidavit or a uniform invoice or certificate of purchase under Section 3-117.1.

(b) If a salvage dealer fails to properly submit applications for salvage certificates or junking certificates at an 85% rate of accuracy or greater, then the Secretary of State Vehicle Services Department may suspend that salvage dealer's right to automatic processing of applications for salvage certificates or junking certificates for a period of not less than 90 days. Prior to the initial suspension of a salvage dealer's right to automatic processing of applications for salvage certificates or junking certificates, the Secretary of State Vehicle Services Department shall provide notice to the salvage dealer of the processing errors or defects and provide the salvage dealer with an opportunity to cure the processing errors or defects within a reasonable period, which shall not be less than 14 days.

If the same processing errors or defects that are contained in the initial notice to the salvage dealer are repeated a second time by a salvage dealer within a 12-month period from the date of the initial notice, then the Secretary of State Vehicle Services Department shall suspend that salvage dealer's right to automatic processing of applications for salvage certificates or junking certificates for a period of not less than 90 days.

If the same processing errors or defects that are contained in the initial notice to a salvage dealer are repeated a third time by the salvage dealer within a 12-month period from the date of the initial notice, then the Secretary of State Vehicle Services Department shall suspend that salvage dealer's right to automatic processing of applications for salvage certificates or junking certificates for a period of not less than 180 days.

(c) After a salvage dealer's right to automatic processing of applications for salvage certificates or junking certificates has been suspended and the applicable suspension period has been served, the salvage dealer may request reinstatement of the right to automatic processing of applications for salvage certificates or junking certificates by demonstrating to the Secretary of State Vehicle Services Department that the salvage dealer has corrected the processing errors or defects that resulted in the suspension. The Secretary of State Vehicle Services Department, after meeting and conferring with the salvage dealer, shall have the sole discretion, subject to the appeal rights in subsection (d), to determine whether to grant the salvage dealer's request for reinstatement.

(d) A salvage dealer may appeal a suspension or a denial of a request for reinstatement of the right to automatic processing of applications for salvage certificates or junking certificates directly to the Secretary of State.

(e) The annual bond posted as required by this Section shall be held by the Secretary of State to secure compensation for an owner of a vehicle if it is determined that the salvage dealer caused the improper transfer of ownership of the vehicle without performing the required procedures set forth in this Chapter. After providing the salvage dealer with a reasonable opportunity to provide proof of its due diligence relating to the disputed transaction and after meeting and conferring with the salvage dealer, the Secretary of State Vehicle Services Department shall determine whether the certificate of title of the vehicle was improperly transferred out of the owner's name by the salvage dealer. This determination shall create a rebuttable presumption that the vehicle was improperly transferred out of the owner's name by the salvage dealer. Upon such a determination by the Secretary of State Vehicle Services Department, if the salvage dealer does not compensate the vehicle owner for the value of the improperly transferred certificate of title, the owner of the vehicle shall have the right to seek reimbursement from the posted bond for the loss of the vehicle under a Court of Claims proceeding.

(f) The security deposited as an annual bond pursuant to this Section shall be placed by the Secretary of State in the custody of the State Treasurer. Thereafter, any person with a claim against the bond may enforce the claim through an appropriate proceeding in the Court of Claims, subject to the limitations prescribed for the Court of Claims.

(Source: P.A. 102-733, eff. 1-1-23.)