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Sentencing Act 2002

Sentences, orders, and related matters - Discharge and miscellaneous orders - Confiscation of motor vehicles

140A: What happens if lessor does not apply to Registrar before motor vehicle sold or disposed of

You could also call this:

"What happens to the money if a leased car is sold and the lessor didn't apply to the court first?"

If you are a lessor and the court says a motor vehicle can be taken away, you must apply to the court before the vehicle is sold. If you do not apply to the court before the vehicle is sold, and the vehicle is sold, you can still apply to the court to get the money from the sale. The court will look at how the money from the sale should be used.

You can apply to the court to get the money that is left from the sale of the vehicle. The court will decide how to use the money, following the rules in section 137. The money will be used to pay you what you would have got if the vehicle had not been sold.

If the vehicle was leased for a year or less, the money will be used to pay some costs first, then to pay you, and then to pay other costs. If the vehicle was leased for more than a year, the money will be used to pay you as if you were a secured party, following the rules in section 137(3)(c). When you get the money from the sale, the lease will be cancelled.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4640204.

Topics:
Crime and justice > Courts and legal helpHousing and property > RentingMoney and consumer rights > Consumer protection
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140: Lessor may apply to Registrar, or

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141: Secured party may apply to court, or

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Part 2Sentences, orders, and related matters
Discharge and miscellaneous orders: Confiscation of motor vehicles

140AWhat happens if lessor does not apply to Registrar before motor vehicle sold or disposed of

  1. This section applies if—

  2. section 140 applies; but
    1. the lessor does not apply to the court for the transfer of the motor vehicle under section 140(1) before it is sold or disposed of; and
      1. the vehicle is sold; and
        1. the proceeds of the sale have not been fully applied.

          1. The lessor may apply to the court for the release of the proceeds of the sale of the motor vehicle that have not been applied.

          2. On an application under subsection (2), the Registrar or a District Court Judge may release the proceeds of the sale of the motor vehicle in accordance with subsections (4) and (5).

          3. The proceeds of the sale of the motor vehicle must be applied in accordance with section 137 as if the lease were a security agreement as defined in section 127(1) and the lessor were a secured party as defined in that subsection.

          4. However, despite subsection (4), section 137 applies subject to the following modifications:

          5. the proceeds of the sale of the motor vehicle must be applied in payment to the lessor of the amount to which the lessor would, but for the sale, have been entitled to under the lease; and
            1. the proceeds of the sale of the motor vehicle must be applied in the manner and order of priority set out in section 137, except that,—
              1. in the case of a lease for a term of 1 year or less, those proceeds must be applied for the payment to the lessor described in paragraph (a) after they are applied for the payments described in section 137(3)(a) and (b), but before they are applied for the remainder of the payments described in section 137(3)(c) to (g); and
                1. in the case of a lease for a term of more than 1 year, those proceeds must be applied for the payment to the lessor described in paragraph (a) as if they were payments described in section 137(3)(c), and section 137(3)(c) and (3A) applied.

                2. On the release of the proceeds of the sale of the motor vehicle to the lessor, the lease is cancelled.

                Notes
                • Section 140A: inserted, on , by section 34 of the Sentencing Amendment Act 2011 (2011 No 47).
                • Section 140A(5)(b)(i): amended, on , by section 4 of the Sentencing Amendment Act 2015 (2015 No 34).