Colorado Auto & Truck Wreckers Ass'n v. Department of Revenue

• Court: Colorado Supreme Court
• Writing for the Court: QUINN; HODGES, C. J., and DUBOFSKY
• Citation: Colorado Auto & Truck Wreckers Ass'n v. Department of Revenue, 618 P.2d 646 (Colo. 1980)
• Decision Date: 15 September 1980
• Docket Number: No. 79SA455,79SA455
• Parties: COLORADO AUTO & TRUCK WRECKERS ASSOCIATION, a Colorado Non-Profit Corporation; Southern Colorado Auto & Truck Wreckers Association, a Colorado Non-Profit Corporation; and A & A Auto Wrecking, Inc., a Colorado Corporation, Plaintiffs- Appellees, v. The DEPARTMENT OF REVENUE of the State of Colorado, Defendant-Appellant.

Page 646

618 P.2d 646

COLORADO AUTO & TRUCK WRECKERS ASSOCIATION, a Colorado Non-Profit Corporation; Southern Colorado Auto & Truck Wreckers Association, a Colorado Non-Profit Corporation; and A & A Auto Wrecking, Inc., a Colorado Corporation Plaintiffs- Appellees, v. The DEPARTMENT OF REVENUE of the State of Colorado Defendant-Appellant.

No. 79SA455.

Supreme Court of Colorado.

Sept. 15, 1980.

Rehearing Denied Oct. 6, 1980.

James A. Beckwith, Fort Collins, Jim Travis Tice, Littleton, for plaintiffs-appellees.

J. D. MacFarlane, Atty. Gen., Richard F. Hennessey, Deputy Atty. Gen., Mary J. Mullarkey, Sol. Gen., Richard H. Forman, Asst. Atty. Gen., Denver, for defendant-appellant.

QUINN, Justice.

This appeal questions the constitutional validity of section 42-6-134 of the Certificate of Title Act, C.R.S.1973 (1979 Supp.), which requires the owner of a motor vehicle to surrender the certificate of title when his vehicle is "sold or otherwise disposed of as salvage", and Department of Revenue regulation 42-6-134(I)(iv), 1 C.C.R. 204-2, which defines this statutory term and establishes procedures for obtaining a salvage receipt upon surrender of the certificate of title.

Plaintiffs-appellees are Colorado Auto and Truck Wreckers Association, Southern Colorado Auto and Truck Wreckers Association, and A & A Wrecking, Inc. (appellees). The two associations consist of auto and truck salvage-yard operators, and A & A Wrecking, Inc., is a corporation engaged in the business of dealing in damaged motor vehicles. In proceedings for judicial review of agency action commenced in the district court under section 24-4-106(4), C.R.S.1973 (1979 Supp.), the appellees successfully challenged the constitutionality of the statute and the validity of the regulation promulgated thereunder by the executive director of the Department of Revenue (department). We reverse the judgment of the district court and uphold the constitutionality of section 42-6-134 and the validity of the regulation.

The General Assembly amended section 42-6-134, C.R.S.1973, in 1976 in an effort to thwart the use of a vehicular theft-device known as the "salvage switch". In a "salvage switch", a person acquires the certificate of title and vehicle identification number (V.I.N.) plates of a damaged vehicle by purchasing the vehicle at a salvage-yard. The V.I.N. plates are usually located on several parts of the vehicle, such as the frame, engine and dashboard, having been placed there by the manufacturer as a basis for identification. The V.I.N. plates are attached to a stolen vehicle of the same make and model as listed on the certificate of title. The stolen vehicle then can be marketed for sale. The title certificate of the salvage-vehicle, which lists the V.I.N. as the primary basis of identification, is transferred to the purchaser at the time of sale. The result is a motor vehicle extremely difficult to identify as stolen, even upon careful scrutiny.

The 1976 amended version of section 42-6-134, 1976 Sess.Laws, ch. 169, Sec. 47, 42-6-134 at 811, provides:

"The owner of any motor vehicle for which a Colorado certificate of title has been issued, upon the destruction or dismantling of said motor vehicle, upon its being changed in such manner that it is no longer a motor vehicle, or upon its being sold or otherwise disposed of as salvage, shall surrender his certificate of title thereto to the director with the request that such certificate of title be cancelled; and, upon said owner's procuring the consent thereto of the holders of any mortgages noted on the certificate of title and shown to be unreleased in the office of the director (of the Department of Revenue), such certificate may thereupon be cancelled. Any person who violates any of the provisions of this section commits a class 1 petty offense and, upon conviction thereof, shall be punished as provided in section 18-1-107, C.R.S.1973." (emphasis added.) ¹

In March 1978 the department published proposed regulation 42-6-134 pertaining to the surrender and cancellation of certificates of title. A rule-making hearing was held as required by section 24-4-103(4) of the State Administrative Procedure Act, C.R.S.1973 (1979 Supp.). Appellees appeared at the hearing and opposed the regulation. The department adopted regulation 42-6-134, 1 C.C.R. 204-2, entitled Surrender and Cancellation of Title, on September 10, 1978, with an effective date of October 1, 1978. Subsection (I)(iv) of the regulation, which is significant to this controversy, provides as follows:

" 'Sold or otherwise disposed of as salvage' shall include the following:

a) The sale or transfer of a motor vehicle, the ownership of which has been assumed by a lienholder or insurance carrier after such vehicle has been damaged by collision, fire, flood or other such occurrence and when such vehicle is not to be repaired by or for the owner in whose name such vehicle was last registered (the 'registered owner') OR

b) The transfer of a damaged motor vehicle which has not been repaired after a total loss settlement has been made by an insurance carrier with respect to the vehicle but ownership of the vehicle has been retained by the registered owner.

c) In the event that a motor vehicle having an estimated value of over $1,000, not covered by insurance, is damaged to the extent that the estimated cost of repair exceeds the wholesale value of the vehicle and such ownership is transferred by its registered owner without repairing the vehicle. " ²

After adoption of the regulation, the appellees commenced a timely action for judicial review. ³ The court determined that section 42-6-134, C.R.S.1973 (1979 Supp.), was unconstitutional; that regulation 42-6-134 was invalid; and that the department should be permanently enjoined from enforcing both the statute and regulation. The district court's judgment was predicated on the following conclusions: (1) section 42-6-134, C.R.S.1973 (1979 Supp.), is void for vagueness because it fails to adequately define "salvage"; (2) the statute is invalid as an unlawful delegation of legislative authority by the General Assembly to the department; (3) regulation 42-6-134 is invalid because its adoption was not based on the record of the rule-making hearing, as required by section 24-4-103(4), C.R.S.1973 (1979 Supp.); (4) the regulation constitutes an unlawful exercise of the department's delegated authority, section 24-4-103(8)(a), C.R.S.1973 (1979 Supp.); (5) the regulation is an unlawful delegation of authority to insurance companies to determine the criminal liability of an owner; (6) the regulation is invalid because it conflicts with sections 42-6-108 and 109 of the Certificate of Title Act, and, therefore, is outside the scope of delegated agency-power under section 24-4-103(8)(a), C.R.S.1973 (1979 Supp.); and (7) the regulation deprives the appellees of a property interest without due process of law.

We address first the constitutionality of section 42-6-134, C.R.S.1973 (1979 Supp.), and then the validity of regulation 42-6-134.

I. THE STATUTE

The district court determined that section 42-6-134, C.R.S.1973 (1979 Supp.) is void for vagueness in violation of U.S. Const. Amend. XIV, and Colo. Const. Art. II, Sec. 25, and that it represents an unlawful delegation of legislative authority to the department. We disagree.

A. Void For Vagueness

Generally, a statute is presumed to be constitutional and a party challenging the statute must prove its invalidity beyond a reasonable doubt. Mr. Luckys, Inc. v. Dolan, 197 Colo. 195, 591 P.2d 1021 (1979); Fry Roofing Co. v. Department of Health, 179 Colo. 223, 499 P.2d 1176 (1972); People ex rel. Dunbar v. Gym of America, Inc., 177 Colo. 97, 493 P.2d 660 (1972). Moreover, if reasonably possible, a statute should be construed so as to avoid a declaration of invalidity for vagueness. R & F Enterprises, Inc. v. Board of County Commissioners, Colo., 606 P.2d 64 (1980); Mr. Luckys, Inc. v. Dolan, supra. See Parker v. Levy, 417 U.S. 733, 94 S.Ct. 2547, 41 L.Ed.2d 439 (1974).

We stated recently in LDS, Inc. v. Healy, 197 Colo. 19, 21, 589 P.2d 490, 491 (1979), that a statute is unconstitutionally vague if "its prohibitions are not sufficiently defined so as to give fair warning as to what conduct is prohibited" or if "it contains no explicit standards for application so that a danger of arbitrary and capricious enforcement exists." However, we have also recognized that "(s)cientific exactitude in statutory language is not required", LDS, Inc. v. Healy, supra at 22, 589 P.2d at 492, and that "a statute need not be drafted with the greatest possible facility or lucidity of expression if it meets the minimal requirements of due process." People v. Blue, 190 Colo. 95, 100, 544 P.2d 385, 389 (1975); accord, Weissman v. Board of Education, 190 Colo. 414, 547 P.2d 1267 (1976). There are reciprocal stresses present in statutory drafting. A statute must be sufficiently specific in order to give fair warning of the conduct prohibited and, simultaneously, sufficiently general to address the essential problem under varied circumstances and during changing times. See Colten v. Kentucky, 407 U.S. 104, 92 S.Ct. 1953, 32 L.Ed.2d 584 (1972); R & F Enterprises, Inc. v. Board of County Commissioners, supra.

Without purporting to cabin the statutory language employed in section 42-6-134, it is apparent that the term "salvage", in its statutory context, connotes the secondary or scrap value of a motor vehicle stemming from a state of damage or disrepair that renders the vehicle unsuitable for its originally intended use on the public highways, in the absence of major alteration or repair. We find that the term "sold or otherwise disposed of as salvage" is sufficiently definite so as to provide notice to potential wrongdoers of the proscribed conduct and to protect against discriminatory enforcement.

B. Unlawful Delegation

The district court concluded that section 42-6-134, C.R.S.1973 ...