Central RV v. Kansas Dept. of Revenue

Citation: Not availableDocket: 119744

Court: Court of Appeals of Kansas; September 27, 2019; Kansas; State Appellate Court

Original Court Document: View Document

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The Kansas Court of Appeals case No. 119,744 involves Central RV, Inc. challenging the Kansas Department of Revenue's issuance of a rebuilt salvage title for a travel trailer previously designated as salvage by Oregon after being damaged. Central RV purchased the trailer from Safeco Insurance, which had obtained the salvage title indicating the trailer was "TOTALED." Upon seeking a clean title in Kansas, Central RV was issued a rebuilt salvage title, which signifies that the vehicle, although previously damaged, has been repaired and is now operable.

Central RV sought a clean title, arguing against the designation of "rebuilt salvage," but the Kansas Department of Revenue maintained that the title issued complied with statutory definitions. The district court sided with the Department, leading to Central RV's appeal. The court noted that since the facts were undisputed, the case hinged on statutory interpretation, particularly around K.S.A. 2018 Supp. 8-197, which defines "rebuilt salvage title" and "salvage vehicle." The court found that since Oregon's designation as a salvage vehicle was valid and the trailer had been repaired, the issuance of the rebuilt salvage title was appropriate and warranted under the law.

The term "salvage vehicle" is defined to include a travel trailer that cannot be registered due to significant damage affecting its compliance with state safety requirements or its operability. Central RV contends its trailer does not qualify as a salvage vehicle since it was operable and in good repair at the time of inspection by the Kansas Highway Patrol. However, the trailer had previously been issued a salvage title in Oregon, labeled "TOTALED," and subsequently repaired. This status does not negate its classification as a rebuilt salvage vehicle, which refers to vehicles that have been repaired after being designated as salvage. 

Central RV's argument hinges on the present-tense wording of the salvage vehicle definition, asserting that the trailer's current condition precludes it from being classified as salvage. The document cites Justice Alito's perspective on legislative drafting, emphasizing that present-tense language should be interpreted contextually, covering multiple time periods. The definition of a rebuilt salvage vehicle inherently implies that it has been repaired and thus would not meet the definition of salvage vehicle in the present tense.

Moreover, Central RV argues the Kansas Department of Revenue cannot issue a rebuilt salvage title to a trailer that never met the salvage vehicle definition under Kansas law. The statute states that a rebuilt salvage title applies to vehicles previously designated as salvage, and the Oregon designation qualifies under this definition. There may be ambiguity regarding whether an out-of-state salvage designation suffices for Kansas’s definition, but the legislative history indicates the law aims to prevent title washing, which Central RV's position could promote. The provisions regarding salvage and rebuilt-salvage titles for travel trailers were first added to the Kansas statute in 2016.

Provisions initially included in Senate Bill 405 were later incorporated into House Bill 2563 through a conference committee. The intent behind these provisions was to prevent the conversion of out-of-state salvage titles into clean titles in Kansas. Ted Smith from the Kansas Department of Revenue indicated that the bill aimed to allow the issuance of salvage brand titles specifically for travel trailers, which, unlike motor vehicles, were not previously subject to the same restrictions against title washing. Don McNeely, representing the Kansas Automobile Dealers Association, supported the bill to enable the Kansas Division of Motor Vehicles to recognize salvage title brands from other states for travel trailers registered in Kansas. The Senate committee's records highlighted that current law permitted obtaining a regular Kansas title for salvage title travel trailers from out of state, a practice Senate Bill 405 sought to amend. The district court's judgment affirming the legislative intent and changes enacted by the bill is upheld.