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DMV Has Overcharged Motorists More than $1 Billion and Refuses to Stop
Court of Appeal Stalls Attempts to Locate People Whose License Fee Refund Claims Are Missing Dear fellow Mopar enthusiast:
Your help is needed to spread the word among your fellow club members, friends and neighbors, that they may be able to obtain refunds and may be able to stop the California Department of Motor Vehicles (DMV) from overcharging them in the future. Unless the public becomes generally aware of the DMV's violations of the federal constitution, the DMV will continue to overcharge vehicle owners. Patrick G. Woosley is fighting the DMV's discrimination against vehicles previously registered outside of California and has obtained a California Supreme Court ruling that the practice is unconstitutional, but the DMV is fighting a vicious fight to retain the overcharges and to keep overcharging in the future despite the Supreme Court's ruling that it is unconstitutional.
The courts have ruled that the DMV does not have to make refunds to an owner unless that owner files a claim for refund. Can you imagine the police finding a warehouse full of stolen goods with the owners names on the items, but the court saying that the burglar gets to keep any stolen goods that the owner does not reclaim, and that the courts will make it hard for the owners to find out that their stolen goods have been found? That is what is happening here. Most people do not know that the DMV stole from them, but some people did file claims. However, the DMV did not keep refund claims filed during many years of this class action lawsuit. The DMV will not make refunds unless claims are filed again, and is pulling out all of the stops to keep their victims of being notified of the overcharges so that they can file, or refile, a claim. The Superior Court was appalled by the DMV's conduct and ordered a broad notice campaign to identify people who had filed the claims for refund of vehicle license fees which the DMV lost. However, the Court of Appeals has at least temporarily blocked the court-ordered program to reconstruct records which the DMV effectively destroyed concerning more than $1 billion in vehicle license fee overcharges.
The Los Angeles Superior Court Class Action Department, Commissioner Bruce E. Mitchell, Presiding, found that the DMV had returned requests for refund to claimants without keeping copies during much of the course of a class action lawsuit and ordered the DMV to attempt to locate people who had filed claims. An 8 page notice would have been mailed later this month to 5.8 million past and present owners of vehicles which were previously registered outside of California.
The DMV asked the Court of Appeals to block the notice program, objecting that the DMV's attempts to reach people who have filed claims would also inform people who do not know that they are being unconstitutionally discriminated against that they also have an opportunity to file claims. The Court of Appeal issued a stay against the notices and scheduled a hearing for November 12.
After the Court of Appeal agreed to have a hearing to consider the DMV's whining, the trial court said, This Court assumes that the Court of Appeal [has agreed to look at the issue] because it recognizes that the issues in this case are compelling, that a systematic injustice -- one could say corruption -- is being perpetrated, which is worthy of appellate comment.
The DMV continues to overcollect by $25 to $30 million a year. It is unlikely that the DMV will ever pay back more than a small fraction of the unconstitutional overcharges due to a previous ruling by the Supreme Court requiring each owner to claim for his or her refunds rather than making the DMV automatically sending refunds. Many people have filed claims, but the majority of victims do not know they are being cheated and will not file claims. Many of the victims do not know that they own or used to own an out-of-state vehicle, although about 10% of all vehicles in California have been registered outside of California. See the appendix for determining whether a vehicle is an out-of-state vehicle.
The Need to File New Refund Claims The DMV frequently voluntarily makes refunds without people even asking for them, but the courts have ruled that the DMV cannot be forced to make refunds unless the victims ask for them and the DMV is refusing to make refunds without claims despite a Supreme Court ruling that the discrimination is unconstitutional. Since the DMV did not keep previous claims, people who filed claims must refile claims to get refunds of overcharges. The DMV is vigorously fighting all attempts to locate people whose claims the DMV lost. And, unless their owners file claims, the DMV intends to continue to overcharge the half million to a million vehicles which are still being overcharged each year.
Please urge your members to file claims for refund even if they have not filed before. Owners should file for as many years as they can and file again each time they renew their licence. The DMV says it will never stop discriminating against the owner of an out-of-state vehicle if the owner does not file a claim.
How to File a Claim Each claim should mention the Woosley litigation, include the claimant's name, address, the license year(s) for which the person is claiming a refund, and if possible, the license number and/or vehicle identification number (VIN). If you do not have either number, file anyway. The Superior Court forced the DMV to compile a list of 5.8 million current and former owners of out-of-state vehicles, with their licence number and vehicle identification number. The DMV can look a claimant up in the data base by his name. One of the DMV's addresses is P.O. Box 942894, Sacramento, CA 94294-0099. An owner does not have to be the person who brought a vehicle into California to get a refund, and the vehicle can be most any kind of vehicle. Even if a prior owner of the vehicle brought it into California, the current owner may have been charged the illegal fees.
The more claims that the DMV receives, the more likely is to stop discriminating against everyone. Owners of collector vehicles have been overcharged the most, but ordinary vehicles have also been overcharged. The discrimination has affected the owners of all types of vehicles, not just automobiles.
Appendix What is the Vehicle License Fee?
Vehicle license fee is part of the yearly charge for operating a vehicle; it is the portion labeled as tax deductible on renewal notices and is in lieu of personal property taxes. The vehicle license fee is computed using a depreciating value; the key elements are the starting value and the date when the statutory depreciation schedule starts. The DMV discriminates against out-of-state vehicles in assigning the starting value and assigning the date when the depreciation schedule starts. Generally, vehicles are not revalued upon resale unless they are purchased after July 1991 from a person who is not a family member; the license fee just continues to drop year after year on statutory schedule starting from when the vehicle was new until it hits the eleventh year on the depreciation schedule where it levels out.How does the DMV Discriminate in Collecting the Vehicle License Fee?
The DMV uses a different starting value and starting time for depreciation of many out-of-state vehicle than it uses for California vehicles of the same make, model and year. For example, California 1957 Fords have a starting price of approximately their $2500 list price when the car was new, and their depreciation schedule started in 1957 even if the car was purchased by its current owner for, say, $10,100 in 1989. In contrast, an identical out-of-state car purchased in 1989 for the same price has its license fee calculated based on the $10,100 price and its depreciation starting in 1989.
Clues to Identifying An Out-of-State Vehicle There are a number of clues that a vehicle originally came from out-of-state -- the type vehicle code, the asterisk year, the manufacturer's certification under the hood for post-1973 cars, and the size of the vehicle license fee. Current and past vehicle owners should file claims if any indicator suggests an out-of-state vehicle, or if they otherwise suspect their current or past vehicles are or were out-of-state vehicles.
The type vehicle code appears on vehicle registration receipts and on the old-style, small, titles (pink slips), but not on new-style, full-page, titles. Type vehicle codes the first two characters of which are 13, 16, 17, 23, 26, 33, 37, 43 and 47 are out-of-state vehicles. Examples of type vehicle codes are marked on the enclosed photocopies of the DMV documents. However, not all vehicles which have been registered in another state, and which are subject to the discriminatory fee calculation have an out-of-state type vehicle code; in fact, one of the representative vehicles in this lawsuit does not have such a code.
The second clue of an out-of-state vehicle is the presence of an asterisk year on the vehicles title or registration less than "92" (for 1992). The asterisk year indicates the year with which DMV started the depreciation schedule, it is often abbreviated * yr and usually appears in an open-topped red box on some titles, and appears on all registration receipts. Examples of asterisk year codes are also marked on the enclosed photocopies of the DMV documents.
The third clue on post-1973 cars is the fact that the manufacturer's EPA certification under the hood does not mention California. The DMV uses this certification to charge the $300 smog impact fee on out-of-state vehicles being brought into California. Get a copy of their brochure on on this tax for details of the sticker, and see below.
The fourth clue is the size of the Vehicle license fee; the Vehicle license fee on a car at least 11 years old should be about 0.003 times the price when new. For instance, a California 1957 Ford would be $2500 x .003 = $7.50 which rounds to $8. (In addition to the license fee, there are about $35 of other fees on each vehicle.) Estimate the value of your vehicle when it was new and multiply that value by 0.003 to see what your fee should be (approximately). If your fee is much more than the estimated fee, you probably were (or are) a victim of the DMV.
What effect did the 1991 law change have? The Legislature started a new system for calculating the license fee on most vehicles sold after July 31, 1991, but the new system does not apply to (1) vehicles which were purchased by their current owners before August 1991 or (2) to vehicles which were purchased from certain close family members after that date so long as the vehicle was in the family at that date. It is sometimes useful to think of the long-time California system as a depreciated-value-when-new system, and the new system as a reassessment on sale system, roughly similar to proposition 13's system for real estate. Fees paid for vehicles following purchase from someone outside of the buyer's immediate family since July 1991 are not part of this lawsuit, so the number currently being discriminated against has dropped from approximately 3 million to about a million.
$300 Smog Impact Fee This dispute is not about the $300 so-called smog impact fee which is charged on some vehicles brought into California, but anyone who paid this fee prior to 1992 probably was overcharged license fees as well. Litigation by other people is challenging the constitutionality of the $300 fee. A similar fee in Florida has been ruled unconstitutional and Florida has made refunds. Your fellow members may want to claim a refund for this discrimination as well. Claims for refund of the so-called smog impact fee should be mailed to the:
State Board of Equalization
P.O. Box 942879
Sacramento, CA 94279-0001and should mention the Due Process, Equal Protection and Commerce Clauses of The United States Constitution.
Patrick G. Woosley
Work: (713) 209-8816
Home: (713) 629-4881
E-Mail: pgwoosley@aol.com
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