Hawaii State Capitol Building, where debate is taking place on H.B. 2596.

BoatUS Voices Support for Hawaii Boat Title Legislation H.B. 2596 offers consumer protections to boat owners

On behalf of Hawaii’s 11,000 registered recreational boat owners and more than 2,500 dues-paying members, Boat Owners Association of The United States (BoatUS) delivered on Friday to the Hawaii House of Representatives Committee on Transportation a letter of support for H.B. 2596, the Uniform Certificate of Title for Vessels Act. BoatUS says the Act would provide needed consumer protections for boat buyers by clearly labeling the titles of damaged vessels, help owners whose boats have been stolen, and create a uniform system of boat titling that would be recognized nationwide and by the US Coast Guard.

The Act requires certain vessel owners to apply for a certificate of title within 20 days of becoming an owner, or within 20 days of establishing principal use of the vessel in waters of the Aloha State. It also establishes the information required in an application for a certificate of title, the process for a transfer of vessel ownership and title, rights of a secured party (such as a bank), and rights of a purchaser other than a secured party.

The letter of support, signed by BoatUS Vice President of Government Affairs Chris Edmonston, said, “The adoption of H.B. 2596 would provide important additional protections and benefits for boat owners. This model vessel title legislation institutionalizes several consumer protection mechanisms that are already commonplace for motor vehicles. These include clear labeling of significant structural damage on vessel titles, the creation of a uniform system to identify legitimate vessel owners/lien-holders, and better prevention of the sale of stolen boats.”

BoatUS notes that while all states have motor vehicle title laws, these do not apply to recreational boats. Hawaii currently has no such vessel title law.

Edmonston’s letter added, “By ‘branding’ the titles of vessels that suffer significant damage, buyers will be made aware of material information that could affect a vessel’s condition. For example, the titles of vessels severely damaged in a storm would be branded, thereby alerting the next and all subsequent buyers (whether they are local or clear across the country) to pay close attention to any repairs and be alert for potential problems.”

This legislation will also help prevent the sale of stolen boats and protect both the owner of the stolen boat and a potential buyer, and allow for the creation of so-called “perfected” liens, improving the protections afforded to boat loan originators.