Existing law establishes a presumption that a person who willfully and intentionally fails to return a leased or rented vehicle to its owner within 5 days of the expiration of the agreement has embezzled the vehicle. Existing law requires every peace officer, upon receiving a report based on reliable information that a registered vehicle has been stolen, or that a leased or rented vehicle has not been returned within 5 days after its owner has made written demand for its return, by certified or registered mail, following the expiration of the lease or rental agreement, to report the information to the Department of Justice Stolen Vehicle System. Except as otherwise provided, a failure to comply with the Vehicle Code is punishable as an infraction.

This bill would reduce the 5-day period following the expiration of the vehicle lease or rental agreement to 48 hours for the presumption of embezzlement to apply. The bill would require the lease or rental agreement to disclose that failure to return the vehicle within 48 hours after expiration of the lease or rental agreement may result in the vehicle being reported stolen. The bill would require the lease or rental agreement to require the lessee or renter to provide a method to contact him or her if the vehicle is not returned as required. The bill would require the owner of an embezzled vehicle to attempt to contact the other party to the lease or rental agreement who has failed to return the vehicle using the contact method specified in the lease or rental agreement. If the owner is able to contact the party, the bill would require the owner to inform the party that if arrangements for the return of the vehicle that are satisfactory for the owner are not made, the owner may report the vehicle stolen to law enforcement. If the owner is not able to contact the other party after a reasonable number of attempts, or if upon contacting the other party, the owner is not able to arrange for the return of the vehicle, the bill would authorize the owner to report the vehicle stolen to a peace officer. With regard to a leased or rented vehicle procured by fraud, the bill would specify that the owner is not required to wait until the expiration of the lease or rental agreement to inform law enforcement of the theft. The bill would except an owner that fails to comply with these requirements from the crime described above. The bill would make conforming changes.

Existing law establishes a presumption that a person who willfully and intentionally fails to return a leased or rented vehicle to its owner within 5 days of the expiration of the agreement has embezzled the vehicle. Existing law requires every peace officer, upon receiving a report based on reliable information that a registered vehicle has been stolen, or that a leased or rented vehicle has not been returned within 5 days after its owner has made written demand for its return, by certified or registered mail, following the expiration of the lease or rental agreement, to report the information to the Department of Justice Stolen Vehicle System. Except as otherwise provided, a failure to comply with the Vehicle Code is punishable as an infraction.

This bill would reduce the 5-day period following the expiration of the vehicle lease or rental agreement to 48 hours for the presumption of embezzlement to apply. The bill would require the lease or rental agreement to disclose that failure to return the vehicle within 48 hours after expiration of the lease or rental agreement may result in the vehicle being reported stolen. The bill would require the lease or rental agreement to require the lessee or renter to provide a method to contact him or her if the vehicle is not returned as required. The bill would require the owner of an embezzled vehicle to attempt to contact the other party to the lease or rental agreement who has failed to return the vehicle using the contact method specified in the lease or rental agreement. If the owner is able to contact the party, the bill would require the owner to inform the party that if arrangements for the return of the vehicle that are satisfactory for the owner are not made, the owner may report the vehicle stolen to law enforcement. If the owner is not able to contact the other party after a reasonable number of attempts, or if upon contacting the other party, the owner is not able to arrange for the return of the vehicle, the bill would authorize the owner to report the vehicle stolen to a peace officer. With regard to a leased or rented vehicle procured by fraud, the bill would specify that the owner is not required to wait until the expiration of the lease or rental agreement to inform law enforcement of the theft. The bill would except an owner that fails to comply with these requirements from the crime described above. The bill would make conforming changes.

Existing law establishes a presumption that a person who willfully and intentionally fails to return a leased or rented vehicle to its owner within 5 days of the expiration of the agreement has embezzled the vehicle. Existing law requires every peace officer, upon receiving a report based on reliable information that a registered vehicle has been stolen, or that a leased or rented vehicle has not been returned within 5 days after its owner has made written demand for its return, by certified or registered mail, following the expiration of the lease or rental agreement, to report the information to the Department of Justice Stolen Vehicle System. Except as otherwise provided, a failure to comply with the Vehicle Code is punishable as an infraction.

This bill would eliminate the 5 day reduce the 5-day period following the expiration of the vehicle lease or rental agreement to 48 hours for the presumption of embezzlement to apply. The bill would require the lease or rental agreement to disclose that failure to return the vehicle within 48 hours after expiration of the lease or rental agreement may result in the vehicle being reported stolen. The bill would require the lease or rental agreement to require the lessee or renter to provide a method to contact him or her if the vehicle is not returned as required. The bill would require the owner of an embezzled vehicle to attempt to contact the other party to the lease or rental agreement who has failed to return the car. vehicle using the contact method specified in the lease or rental agreement. If the owner is able to contact the party, the bill would require the owner to inform the party that if arrangements for the return of the car vehicle that are satisfactory for the owner are not made, the owner is required may report the car vehicle stolen to law enforcement. If the owner is not able to contact the other party after a reasonable number of attempts, or if upon contacting the other party, the owner is not able to arrange for the return of the vehicle, the bill would require authorize the owner to report the vehicle stolen to a peace officer. With regard to a leased or rented vehicle procured by fraud, the bill would specify that the owner is not required to wait until the expiration of the lease or rental agreement to inform law enforcement of the theft and would require the owner to do so. The bill would give the peace officer the option of reporting these types of thefts to the Department of Justice Stolen Vehicle System. theft. The bill would except an owner that fails to comply with these requirements from the penalty crime described above. The bill would make conforming changes.

Existing law establishes a presumption that a person who willfully and intentionally fails to return a leased or rented vehicle to its owner within 5 days of the expiration of the agreement has embezzled the vehicle. Existing law requires every peace officer, upon receiving a report based on reliable information that a registered vehicle has been stolen, or that a leased or rented vehicle has not been returned within 5 days after its owner has made written demand for its return, by certified or registered mail, following the expiration of the lease or rental agreement, to report the information to the Department of Justice Stolen Vehicle System. Except as otherwise provided, a failure to comply with the Vehicle Code is punishable as an infraction.

This bill would eliminate the 5 day period following the expiration of the vehicle lease or rental agreement for the presumption of embezzlement to apply. The bill would require the owner of an embezzled vehicle to attempt to contact the other party to the lease or rental agreement who has failed to return the car. If the owner is able to contact the party, the bill would require the owner to inform the party that if arrangements for the return of the car that are satisfactory for the owner are not made, the owner is required report the car stolen to law enforcement. If the owner is not able to contact the other party after a reasonable number of attempts, or if upon contacting the other party, the owner is not able to arrange for the return of the vehicle, the bill would require the owner to report the vehicle stolen to a peace officer. With regard to a leased or rented vehicle procured by fraud, the bill would specify that the owner is not required to wait until the expiration of the lease or rental agreement to inform law enforcement of the theft and would require the owner to do so. The bill would give the peace officer the option of reporting these types of thefts to the Department of Justice Stolen Vehicle System. The bill would except an owner that fails to comply with these requirements from the penalty described above. The bill would make conforming changes.

GOVERNOR'S VETO

GV Bill Id:AB 2169

Author:(Voepel)

As Enrolled Ver:August 10, 2018

2/3 vote

Original Committee Reference: PUB. S.

SUMMARY: Decreases the five-day period following the expiration of an auto-rental agreement or lease for the presumption of embezzlement to apply to 48 hours.

The Senate amendments specify that a peace officer may not report a rental vehicle to the Department of Justice Stolen Vehicle System unless the vehicle owner has tried to contact the leasee as per the rental agreement.

EXISTING LAW:

1. Creates a rebuttable presumption that a person has embezzled a leased or rented car if the person willfully and intentionally fails to return the vehicle to its owner within five days after the lease or rental agreement has expired.
2. Provides that any person who drives or takes a vehicle not his or her own, without the owner’s consent, and with intent either to permanently or temporarily deprive the owner of his or her title to, or possession, of the vehicle, whether with or without intent to steal it, is guilty of a crime punishable by imprisonment in a county jail for not more than one year, in the county jail pursuant to realignment, or by a fine of up to $5,000, or by both the fine and imprisonment.
3. States that a person who feloniously steals, takes, carries, leads, or drives away the personal property of another, or who fraudulently appropriates property which has been entrusted to him or her is guilty of theft.
4. States that if the stolen property is an automobile, then the offense constitutes grand theft.
5. Punishes grand theft of a vehicle by imprisonment in a county jail not exceeding one year, or in the county jail pursuant to realignment.
6. Defines ''embezzlement'' as ''the fraudulent appropriation of property by a person to whom it has been intrusted.''
7. Provides that every person guilty of embezzlement is punishable in the manner prescribed for theft of property of the value or kind embezzled.
8. Requires a peace officer who receives a report based on reliable information that a vehicle has been stolen or unlawfully taken, or that a leased or rented vehicle has not been returned within five days after the lease or rental agreement has expired, to immediately report the information to the DOJ Stolen Vehicle System.
9. Prohibits a rental company from using, accessing, or obtaining any information relating to the renter's use of the rental vehicle that was obtained using electronic surveillance technology, unless the technology is used to locate a stolen, abandoned, or missing rental vehicle after one of the following:
   1. The renter or law enforcement has informed the rental car company that the vehicle is missing or has been stolen or abandoned;
   2. The rental vehicle has not been returned following one week after the contracted return date, or one week following the end of an extension of that return date; or
   3. The rental car company discovers that the vehicle has been stolen or abandoned and, if stolen, reports the vehicle stolen to law enforcement by filing a stolen vehicle report.

AS PASSED BY THE ASSEMBLY, this bill:

1. Provided that if a person who has leased or rented a vehicle willfully and intentionally fails to return it to its owner 48 hours after the agreement has expired, it is presumed that the person has embezzled the vehicle.
2. Stated that if the owner of a vehicle that has been leased or rented discovers that it was procured by fraud, the owner is not required to wait until the expiration of the lease or rental agreement to make a report to law enforcement.
3. Required a vehicle lease or rental agreement to contain a disclosure stating that failure to return the vehicle within 48 hours of its expiration may result in the owner reporting the vehicle as stolen, and requires the leasee to provide a method to contact him or her if the vehicle is not returned.
4. Required the owner of a vehicle that is presumed to have been embezzled to attempt to contact the other party to the lease or rental agreement using the contact method designated in the rental agreement for this purpose.
5. Required the vehicle owner to inform the other party that if arrangements for the return of the car are not satisfactorily made, the owner may report the car stolen to law enforcement.
6. Stated that if the owner of a vehicle that is presumed to have been embezzled is unable to contact the other party after a reasonable number of attempts, or if he or she is unable to arrange for the satisfactory return of the vehicle, the owner may report the vehicle as stolen.
7. Stated that the failure of a vehicle owner to comply with these provisions shall not be deemed an infraction.
8. Made conforming changes to the provisions related to law enforcement reporting to the Department of Justice (DOJ) Stolen Vehicle System.

FISCAL EFFECT: According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

COMMENTS:

1. Author's Statement: ''AB 2169 is a win for everyone—the consumer whose identity is in the process of getting stolen, the rental industry, and the law enforcement. This bill works to create transparency and efficiency in the rental car industry. AB 2169 not only updates the outdated process of reporting, but it addresses a problem that occurs across our state.''
2. Inconsistency with Other Laws: California prohibits rental car companies from tracking vehicles with global positioning technology (GPS) devices, except in a few narrowly defined situations. Current law prohibits GPS information from being accessed without the customer’s consent unless the vehicle is missing, abandoned, or stolen, or the customer fails to return the vehicle within one week of the contracted return date. In contrast, under current law the vehicle can be presumed to be embezzled after five days, two days less than when the GPS device can be activated.

Notably, AB 2051 (O’Donnell), Chapter 183, Statutes of 2016, would have allowed rental car companies to track missing cars with global positioning technology (GPS) after three days, but that provision was deleted from the bill. And yet this bill shortens the time for the presumption of embezzlement to 48 hours, thereby increasing the time difference between the two. It raises the question of whether these two time limits should be reconciled.

GOVERNOR'S VETO MESSAGE:

This bill reduces the period of time following the expiration of a vehicle lease or rental agreement from 5 days to 48 hours before the person who has leased the vehicle is presumed to have embezzled the vehicle.

I understand the importance of enabling car rental companies to protect against those who steal their cars. In this case, however, I believe there are other solutions available that would work better, such as the increased use of GPS technology.

Analysis Prepared by: Sandy Uribe / PUB. S. / (916) 319-3744 FN: 0004993

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2169

Author:(Voepel)

As Amended Ver:May 22, 2018

Majority vote

Original Committee Reference: PUB. S.

SUMMARY: Decreases the five-day period following the expiration of an auto-rental agreement or lease for the presumption of embezzlement to apply to 48 hours.

The Senate amendments specify that a peace officer may not report a rental vehicle to the Department of Justice (DOJ) Stolen Vehicle System unless the vehicle owner has tried to contact the leasee as per the rental agreement.

EXISTING LAW:

1. Creates a rebuttable presumption that a person has embezzled a leased or rented car if the person willfully and intentionally fails to return the vehicle to its owner within five days after the lease or rental agreement has expired.
2. Provides that any person who drives or takes a vehicle not his or her own, without the owner’s consent, and with intent either to permanently or temporarily deprive the owner of his or her title to, or possession, of the vehicle, whether with or without intent to steal it, is guilty of a crime punishable by imprisonment in a county jail for not more than one year, in the county jail pursuant to realignment, or by a fine of up to $5,000, or by both the fine and imprisonment.
3. States that a person who feloniously steals, takes, carries, leads, or drives away the personal property of another, or who fraudulently appropriates property which has been entrusted to him or her is guilty of theft.
4. States that if the stolen property is an automobile, then the offense constitutes grand theft.
5. Punishes grand theft of a vehicle by imprisonment in a county jail not exceeding one year, or in the county jail pursuant to realignment.
6. Defines ''embezzlement'' as ''the fraudulent appropriation of property by a person to whom it has been entrusted.''
7. Provides that every person guilty of embezzlement is punishable in the manner prescribed for theft of property of the value or kind embezzled.
8. Requires a peace officer who receives a report based on reliable information that a vehicle has been stolen or unlawfully taken, or that a leased or rented vehicle has not been returned within five days after the lease or rental agreement has expired, to immediately report the information to the DOJ Stolen Vehicle System.
9. Prohibits a rental company from using, accessing, or obtaining any information relating to the renter's use of the rental vehicle that was obtained using electronic surveillance technology, unless the technology is used to locate a stolen, abandoned, or missing rental vehicle after one of the following:
   1. The renter or law enforcement has informed the rental car company that the vehicle is missing or has been stolen or abandoned;
   2. The rental vehicle has not been returned following one week after the contracted return date, or one week following the end of an extension of that return date; or
   3. The rental car company discovers that the vehicle has been stolen or abandoned and, if stolen, reports the vehicle stolen to law enforcement by filing a stolen vehicle report.

AS PASSED BY THE ASSEMBLY, this bill:

1. Provided that if a person who has leased or rented a vehicle willfully and intentionally fails to return it to its owner 48 hours after the agreement has expired, it is presumed that the person has embezzled the vehicle.
2. Stated that if the owner of a vehicle that has been leased or rented discovers that it was procured by fraud, the owner is not required to wait until the expiration of the lease or rental agreement to make a report to law enforcement.
3. Required a vehicle lease or rental agreement to contain a disclosure stating that failure to return the vehicle within 48 hours of its expiration may result in the owner reporting the vehicle as stolen, and requires the leasee to provide a method to contact him or her if the vehicle is not returned.
4. Required the owner of a vehicle that is presumed to have been embezzled to attempt to contact the other party to the lease or rental agreement using the contact method designated in the rental agreement for this purpose.
5. Required the vehicle owner to inform the other party that if arrangements for the return of the car are not satisfactorily made, the owner may report the car stolen to law enforcement.
6. Stated that if the owner of a vehicle that is presumed to have been embezzled is unable to contact the other party after a reasonable number of attempts, or if he or she is unable to arrange for the satisfactory return of the vehicle, the owner may report the vehicle as stolen.
7. Stated that the failure of a vehicle owner to comply with these provisions shall not be deemed an infraction.
8. Made conforming changes to the provisions related to law enforcement reporting to the Department of Justice (DOJ) Stolen Vehicle System.

FISCAL EFFECT: According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

COMMENTS:

1. Author's Statement: ''AB 2169 is a win for everyone—the consumer whose identity is in the process of getting stolen, the rental industry, and the law enforcement. This bill works to create transparency and efficiency in the rental car industry. AB 2169 not only updates the outdated process of reporting, but it addresses a problem that occurs across our state.''
2. Inconsistency with Other Laws: California prohibits rental car companies from tracking vehicles with global positioning technology (GPS) devices, except in a few narrowly defined situations. Current law prohibits GPS information from being accessed without the customer's consent unless the vehicle is missing, abandoned, or stolen, or the customer fails to return the vehicle within one week of the contracted return date. In contrast, under current law the vehicle can be presumed to be embezzled after five days, two days less than when the GPS device can be activated.

Notably, AB 2051 (O’Donnell), Chapter 183, Statutes of 2016, would have allowed rental car companies to track missing cars with global positioning technology (GPS) after three days, but that provision was deleted from the bill. And yet this bill shortens the time for the presumption of embezzlement to 48 hours, thereby increasing the time difference between the two. It raises the question of whether these two time limits should be reconciled.

Analysis Prepared by: Sandy Uribe / PUB. S. / (916) 319-3744 FN: 0003636

 THIRD READING  

Bill No: AB 2169

Author:

:

Vote:

SENATE PUBLIC SAFETY COMMITTEE: 5-0, 5/15/18

AYES: Skinner, Anderson, Mitchell, Stone, Wiener

NO VOTE RECORDED: Bradford, Jackson

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 68-0, 4/12/18 (Consent) - See last page for vote

SUBJECT:

SOURCE: Author

DIGEST:

This bill reduces the period of time following the expiration of an auto-rental agreement or lease for the presumption of embezzlement to apply, from five days to 48 hours.

ANALYSIS:

Existing law:

1. Creates a rebuttable presumption that a person has embezzled a leased or rented car if the person willfully and intentionally fails to return the vehicle to its owner within five days after the lease or rental agreement has expired. (Veh. Code § 10855.)
2. Provides that any person who drives or takes a vehicle not his or her own, without the owner’s consent, and with intent either to permanently or temporarily deprive the owner of his or her title to, or possession, of the vehicle, whether with or without intent to steal it, is guilty of a crime punishable by imprisonment in a county jail for not more than one year, in the county jail pursuant to realignment, or by a fine of up to $5,000, or by both the fine and imprisonment. (Veh. Code § 10851.)
3. States that a person who feloniously steals, takes, carries, leads, or drives away the personal property of another, or who fraudulently appropriates property which has been entrusted to him or her is guilty of theft. (Pen. Code § 484, subd. (a).)
4. States that if the stolen property is an automobile, then the offense constitutes grand theft. (Pen. Code § 487, subd. (d)(1).)
5. Punishes grand theft of a vehicle by imprisonment in a county jail not exceeding one year, or in the county jail pursuant to realignment. (Pen. Code § 489, subd. (c).)
6. Defines “embezzlement” as “the fraudulent appropriation of property by a person to whom it has been entrusted.” (Pen. Code § 503.)
7. Provides that every person guilty of embezzlement is punishable in the manner prescribed for theft of property of the value or kind embezzled. (Pen. Code § 514.)
8. Requires a peace officer who receives a report based on reliable information that a vehicle has been stolen or unlawfully taken, or that a leased or rented vehicle has not been returned within five days after the lease or rental agreement has expired, to immediately report the information to the Department of Justice Stolen Vehicle System. (Veh. Code § 10500.)
9. Prohibits a rental company from using, accessing, or obtaining any information relating to the renter’s use of the rental vehicle that was obtained using electronic surveillance technology, unless the technology is used to locate a stolen, abandoned, or missing rental vehicle after one of the following:
   1. The renter or law enforcement has informed the rental car company that the vehicle is missing or has been stolen or abandoned;
   2. The rental vehicle has not been returned following one week after the contracted return date, or one week following the end of an extension of that return date; or
   3. The rental car company discovers that the vehicle has been stolen or abandoned and, if stolen, reports the vehicle stolen to law enforcement by filing a stolen vehicle report. (Civil Code § 1936, subd. (n)(1)(i)-(iii).)

This bill:

1. Provides that if a person who has leased or rented a vehicle willfully and intentionally fails to return it to its owner 48 hours after the agreement has expired, it is presumed that the person has embezzled the vehicle.
2. Specifies that the vehicle owner must attempt to notify the customer, as specified.
3. States that if the owner of a vehicle that has been leased or rented discovers that it was procured by fraud, the owner is not required to wait until the expiration of the lease or rental agreement to make a report to law enforcement.
4. Requires a vehicle lease or rental agreement to contain a disclosure stating that failure to return the vehicle within 48 hours of its expiration may result in the owner reporting the vehicle as stolen, and requires the lessee to provide a method to contact him or her if the vehicle is not returned.
5. Requires the owner of a vehicle that is presumed to have been embezzled to attempt to contact the other party to the lease or rental agreement using the contact method designated in the rental agreement for this purpose.
6. Requires the vehicle owner to inform the other party that if arrangements for the return of the car are not satisfactorily made, the owner may report the car stolen to law enforcement.
7. States that if the owner of a vehicle that is presumed to have been embezzled is unable to contact the other party after a reasonable number of attempts, or if he or she is unable to arrange for the satisfactory return of the vehicle, the owner may report the vehicle as stolen.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 6/25/18)

California District Attorneys Association

California Police Chiefs Association

OPPOSITION: (Verified 6/25/18)

California Public Defenders Association

ARGUMENT IN SUPPORT: According to the California District Attorneys Association, “AB 2169 would allow rental car agencies to immediately report a stolen vehicle that was not returned upon the expiration of the contract, instead of having to wait five-days under current law. Over the last several years, theft of rental vehicles has increased substantially in cities across California, and it is now more important for rental car companies to report possible thefts to law enforcement immediately in order to increase the possibility that the stolen vehicle is located and returned.”

ARGUMENT IN OPPOSITION: According to the California Public Defenders Association:

As tempting as if may be to craft statutory means of facilitating return of leased vehicles and preventing theft it is important to remember that mere statues cannot amend the Constitution. Before the police can initiate a seizure on the streets someone in the official chain must have probable cause to believe that a crime has occurred.

AB 2169, as amended effectively cuts the police out of the probable cause equation and makes them and the state’s official Stolen Vehicle System a mere tool in a private business’s efforts to retrieve its property. In doing so it gives short shrift to the civil rights of customers and pays inadequate attention to the critical issue of actual criminal guilt or innocence.

ASSEMBLY FLOOR: 68-0, 4/12/18

AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bonta, Brough, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Grayson, Harper, Holden, Irwin, Kalra, Kiley, Lackey, Levine, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Muratsuchi, Nazarian, Obernolte, O’Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon

NO VOTE RECORDED: Bloom, Cristina Garcia, Gray, Jones-Sawyer, Limón, Low, Mullin, Santiago, Steinorth

Prepared by:

6/26/18 13:31:03

**** END ****

SENATE COMMITTEE ON PUBLIC SAFETY

Senator Nancy Skinner, Chair

2017 - 2018 Regular

Bill No: AB 2169 Hearing Date: May 15, 2018

Subject: Leased and Rented Vehicles: Embezzlement and Theft

HISTORY

Source: Author

Prior Legislation: AB 495 (Voepel), 2017, hearing cancelled in Assembly Public Safety

AB 2051 (O'Donnell), Ch. 183, Stats. of 2016

AB 2804 (Corbett), Ch. 317, Stats. of 2004

Support: California District Attorneys Association; California Police Chiefs Association

Opposition: California Public Defenders Association

Assembly Floor Vote: 68 - 0

PURPOSE

The purpose of this bill is to reduce the period of time following the expiration of an auto-rental agreement or lease for the presumption of embezzlement to apply, from five-days to 48-hours.

Existing law creates a rebuttable presumption that a person has embezzled a leased or rented car if the person willfully and intentionally fails to return the vehicle to its owner within five days after the lease or rental agreement has expired. (Veh. Code, § 10855.)

This bill provides that if a person who has leased or rented a vehicle willfully and intentionally fails to return it to its owner 48 hours after the agreement has expired, it is presumed that the person has embezzled the vehicle.

Existing law provides that any person who drives or takes a vehicle not his or her own, without the owner’s consent, and with intent either to permanently or temporarily deprive the owner of his or her title to, or possession, of the vehicle, whether with or without intent to steal it, is guilty of a crime punishable by imprisonment in a county jail for not more than one year, in the county jail pursuant to realignment, or by a fine of up to $5,000, or by both the fine and imprisonment. (Veh. Code, § 10851.)

Existing law states that a person who feloniously steals, takes, carries, leads, or drives away the personal property of another, or who fraudulently appropriates property which has been entrusted to him or her is guilty of theft. (Pen. Code, § 484, subd. (a).)

Existing law states that if the stolen property is an automobile, then the offense constitutes grand theft. (Pen. Code, § 487, subd. (d)(1).)

Existing law punishes grand theft of a vehicle by imprisonment in a county jail not exceeding one year, or in the county jail pursuant to realignment. (Pen. Code, § 489, subd. (c).)

Existing law defines “embezzlement” as “the fraudulent appropriation of property by a person to whom it has been entrusted.” (Pen. Code, § 503.)

Existing law provides that every person guilty of embezzlement is punishable in the manner prescribed for theft of property of the value or kind embezzled. (Pen. Code, § 514.)

Existing law requires a peace officer who receives a report based on reliable information that a vehicle has been stolen or unlawfully taken, or that a leased or rented vehicle has not been returned within five days after the lease or rental agreement has expired, to immediately report the information to the DOJ Stolen Vehicle System. (Veh. Code, § 10500.)

Existing law prohibits a rental company from using, accessing, or obtaining any information relating to the renter's use of the rental vehicle that was obtained using electronic surveillance technology, unless the technology is used to locate a stolen, abandoned, or missing rental vehicle after one of the following:

• The renter or law enforcement has informed the rental car company that the vehicle is missing or has been stolen or abandoned;
• The rental vehicle has not been returned following one week after the contracted return date, or one week following the end of an extension of that return date; or
• The rental car company discovers that the vehicle has been stolen or abandoned and, if stolen, reports the vehicle stolen to law enforcement by filing a stolen vehicle report. (Civil Code, § 1936, subd. (n)(1)(i)-(iii).)

This bill states that if the owner of a vehicle that has been leased or rented discovers that it was procured by fraud, the owner is not required to wait until the expiration of the lease or rental agreement to make a report to law enforcement.

This bill requires a vehicle lease or rental agreement to contain a disclosure stating that failure to return the vehicle within 48 hours of its expiration may result in the owner reporting the vehicle as stolen, and requires the leasee to provide a method to contact him or her if the vehicle is not returned.

This bill requires the owner of a vehicle that is presumed to have been embezzled to attempt to contact the other party to the lease or rental agreement using the contact method designated in the rental agreement for this purpose.

This bill requires the vehicle owner to inform the other party that if arrangements for the return of the car are not satisfactorily made, the owner may report the car stolen to law enforcement.

This bill states that if the owner of a vehicle that is presumed to have been embezzled is unable to contact the other party after a reasonable number of attempts, or if he or she is unable to arrange for the satisfactory return of the vehicle, the owner may report the vehicle as stolen.

This bill states that the failure of a vehicle owner to comply with these provisions shall not be deemed an infraction.

This bill makes conforming changes to the provisions related to law enforcement reporting to the Department of Justice (DOJ) Stolen Vehicle System.

COMMENTS

1. Need for This Bill

According to the author:

The problem or the deficiency in the existing law is that it doesn’t allow the rental car companies to report fraud quicker and be able to get their vehicle back after it has been stolen. What rental car industry has realized is that in the last years, their cars are not only stolen, but it is stolen by false identity. This bill reduces the current 5 day waiting period that is in statue to 48 hours. This measure requires the lease or rental agreement to disclose that the failure to return the vehicle within 48 hours after the expiration of the rental agreement may result in vehicle being reported as stolen. Finally, the lease or rental agreement to require the lessee or renter to provide a method of contact if vehicle is not returned on time. This bill would create efficiency and would help both the Industry and Law enforcement to combat the incident.

1. Theft of Rental Cars and the Effect of This Bill

Under current California law, California prohibits rental car companies from tracking vehicles with global positioning systems (GPS) devices, except in narrowly defined circumstances. GPS information may not be accessed by rental companies without the customer’s consent unless the vehicle is missing, abandoned, stolen, or the customer fails to return the vehicle within one week of the contracted return date. However, under current law the vehicle can be presumed to be embezzled after five days, two days less than when the GPS device can be activated.

AB 2051 (O’Donnell), Ch. 183, Stats. of 2016 would have allowed rental car companies to track missing cars with GPS technology after three-days, but that provision was deleted from the bill prior to signing.

This bill shortens the time for the presumption of embezzlement from 5-days to 48-hours. However, this bill does not modify the time that must pass prior to permitting tracking of a vehicle with a GPS system. The time that a rental company must wait prior to permitting GPS tracking remains one-week under this bill. Perhaps the best policy would be to synchronize these time-frames.

1. California’s Stolen Vehicle System

California has a Stolen Vehicle System that helps law enforcement track and locate vehicles that have been reported stolen. The system is maintained by the California Department of Justice. Under the law, law enforcement officers must enter a vehicle into the system upon receipt of reliable information that the vehicle has been stolen, or that a leased vehicle has not been returned within five days after the owner has made written demand for its return by certified or registered mail. (Veh. Code, § 10500, subd. (a).) This bill would amend this provision to require notice shall be sent to the Stolen Vehicle System if 48 hours following the expiration of the lease or rental agreement.

Opponents to this legislation argue that the shortening of the period from 5-days to 48-hours removes the limited opportunity for an approximation of probable cause because the delay in returning the vehicle is more than minor, and permitted actual notice to the customer who rented the vehicle.

The following amendment could mitigate the concerns of the opposition:

Section 10500 of the Vehicle Code is amended to read:

10500. (a) Every peace officer, upon receiving a report based on reliable information that any vehicle registered under this code has been stolen, taken, or driven in violation of Section 10851, or that a leased or rented vehicle has not been returned within 48 hours following the expiration of the lease or rental agreement and after the owner attempted to notify the customer pursuant to the provisions in Vehcile Code Section 10855, subd. (b) , or that license plates for any vehicle have been lost or stolen, shall, immediately after receiving that information, report the information to the Department of Justice Stolen Vehicle System. An officer, upon receiving information of the recovery of any vehicle described in this subdivision, or of the recovery of plates which have been previously reported as lost or stolen, shall immediately report the fact of the recovery to the Department of Justice Stolen Vehicle System. At the same time, the recovering officer shall advise the Department of Justice Stolen Vehicle System and the original reporting police agency of the location and condition of the vehicle or license plates recovered. The original reporting police agency, upon receipt of the information from the recovering officer, shall, immediately attempt to notify the reporting party by telephone, if the telephone number of the reporting party is available or readily accessible, of the location and condition of the recovered vehicle. If the reporting party’s telephone number is unknown, or notification attempts were unsuccessful, the original reporting police agency shall notify the reporting party by placing, in the mail, a notice providing the location and condition of the recovered vehicle. This written notice shall be mailed within 24 hours of the original reporting police agency’s receipt of the information of the recovery of the vehicle, excluding holidays and weekends.

(b) If the recovered vehicle is subject to parking or storage charges, Section 10652.5 applies.

The provision in this amendment is the newly updated notice requirement that was amended into the bill in the Assembly Public Safety Committee. Under current law, notice must be given by registered or certified mail. The new notice procedures were seen as an update to the outdated language of using registered or certified mail to contact the driver of the vehicle. The new notice provisions read as follows:

Section 10855 of the Vehicle Code, subd. (b) states:

(b) The owner of an embezzled vehicle as described in paragraph (1) of subdivision (a) shall attempt to contact the other party to the lease or rental agreement who has failed to return the vehicle using the contact method designated in the rental agreement for this purpose. If the owner is able to contact the party, the owner shall inform the party that if arrangements for the return of the vehicle that are satisfactory for the owner are not made, the owner may report the vehicle stolen to law enforcement. If the owner is not able to contact the other party after a reasonable number of attempts, or if upon contacting the other party, the owner is not able arrange for the satisfactory return of the vehicle, the owner may report the vehicle stolen pursuant to subdivision (c).

Should the author made the aforementioned amendment to their bill, the entry of the vehicle into the Stolen Vehicle System would not occur until the lessor of the vehicle made an attempt to notify the driver in the manner contemplated by the bill.

1. Argument in Support

According to the California District Attorneys Association:

AB 2169 would allow rental car agencies to immediately report a stolen vehicle that was not returned upon the expiration of the contract, instead of having to wait five-days under current law. Over the last several years, theft of rental vehicles has increased substantially in cities across California, and it is now more important for rental car companies to report possible thefts to law enforcement immediately in order to increase the possibility that the stolen vehicle is located and returned.

4. Argument in Opposition

According to the California Public Defenders Association:

As tempting as if may be to craft statutory means of facilitating return of leased vehicles and preventing theft it is important to remember that mere statues cannot amend the Constitution. Before the police can initiate a seizure on the streets someone in the official chain must have probable cause to believe that a crime has occurred.

AB 2169, as amended effectively cuts the police out of the probable cause equation and makes them and the state’s official Stolen Vehicle System a mere tool in a private business’s efforts to retrieve its property. In doing so it gives short shrift to the civil rights of customers and pays inadequate attention to the critical issue of actual criminal guilt or innocence.

-- END –

Date of Hearing: April 4, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2169

Author:(Voepel) – As Amended Ver:March 22, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill decreases the waiting period for a car rental company to report a vehicle as stolen if the vehicle is not returned at the end of the agreed upon rental term. Specifically, this bill reduces the waiting period from five days to 48 hours and requires car rental companies to disclose this information to customers in the rental agreement.

FISCAL EFFECT:

Negligible fiscal effect.

COMMENTS:

Background and purpose. Writing on the need for this bill, the California Police Chiefs Association states:

Over the last several years, theft of rented vehicles has increased substantially in cities across California, and it is now more important than ever for rental car companies to report possible thefts to law enforcement immediately in order to increase the probability that the stolen vehicle is located and returned.

Analysis Prepared by: Jessica Peters / APPR. / (916) 319-2081

Date of Hearing:

Counsel: Sandra Uribe

ASSEMBLY COMMITTEE ON PUBLIC SAFETY

Reginald Byron Jones-Sawyer, Sr., Chair

ABPCA Bill Id:AB 2169

Author:(Voepel) – As Introduced Ver:February 12, 2018

As Proposed to be Amended in Committee

SUMMARY:

Decreases the five-day period following the expiration of an auto-rental agreement or lease for the presumption of embezzlement to apply to 48 hours. Specifically, this bill:

1. Provides that if a person who has leased or rented a vehicle willfully and intentionally fails to return it to its owner 48 hours after the agreement has expired, it is presumed that the person has embezzled the vehicle.
   
2. States that if the owner of a vehicle that has been leased or rented discovers that it was procured by fraud, the owner is not required to wait until the expiration of the lease or rental agreement to make a report to law enforcement.
   
3. Requires a vehicle lease or rental agreement to contain a disclosure stating that failure to return the vehicle within 48 hours of its expiration may result in the owner reporting the vehicle as stolen, and requires the leasee to provide a method to contact him or her if the vehicle is not returned.
   
4. Requires the owner of a vehicle that is presumed to have been embezzled to attempt to contact the other party to the lease or rental agreement using the contact method designated in the rental agreement for this purpose.
   
5. Requires the vehicle owner to inform the other party that if arrangements for the return of the car are not satisfactorily made, the owner may report the car stolen to law enforcement.
   
6. States that if the owner of a vehicle that is presumed to have been embezzled is unable to contact the other party after a reasonable number of attempts, or if he or she is unable to arrange for the satisfactory return of the vehicle, the owner may report the vehicle as stolen.
   
7. States that the failure of a vehicle owner to comply with these provisions shall not be deemed an infraction.
   
8. Makes conforming changes to the provisions related to law enforcement reporting to the Department of Justice (DOJ) Stolen Vehicle System.

EXISTING LAW:

1. Creates a rebuttable presumption that a person has embezzled a leased or rented car if the person willfully and intentionally fails to return the vehicle to its owner within five days after the lease or rental agreement has expired. (Veh. Code, § 10855.)
   
2. Provides that any person who drives or takes a vehicle not his or her own, without the owner’s consent, and with intent either to permanently or temporarily deprive the owner of his or her title to, or possession, of the vehicle, whether with or without intent to steal it, is guilty of a crime punishable by imprisonment in a county jail for not more than one year, in the county jail pursuant to realignment, or by a fine of up to $5,000, or by both the fine and imprisonment. (Veh. Code, § 10851.)
   
3. States that a person who feloniously steals, takes, carries, leads, or drives away the personal property of another, or who fraudulently appropriates property which has been entrusted to him or her is guilty of theft. (Pen. Code, § 484, subd. (a).)
   
4. States that if the stolen property is an automobile, then the offense constitutes grand theft. (Pen. Code, § 487, subd. (d)(1).)
   
5. Punishes grand theft of a vehicle by imprisonment in a county jail not exceeding one year, or in the county jail pursuant to realignment. (Pen. Code, § 489, subd. (c).)
   
6. Defines “embezzlement” as “the fraudulent appropriation of property by a person to whom it has been intrusted.” (Pen. Code, § 503.)
   
7. Provides that every person guilty of embezzlement is punishable in the manner prescribed for theft of property of the value or kind embezzled. (Pen. Code, § 514.)
   
8. Requires a peace officer who receives a report based on reliable information that a vehicle has been stolen or unlawfully taken, or that a leased or rented vehicle has not been returned within five days after the lease or rental agreement has expired, to immediately report the information to the DOJ Stolen Vehicle System. (Veh. Code, § 10500.)
   
9. Prohibits a rental company from using, accessing, or obtaining any information relating to the renter's use of the rental vehicle that was obtained using electronic surveillance technology, unless the technology is used to locate a stolen, abandoned, or missing rental vehicle after one of the following:
   
   1. The renter or law enforcement has informed the rental car company that the vehicle is missing or has been stolen or abandoned;
      
   2. The rental vehicle has not been returned following one week after the contracted return date, or one week following the end of an extension of that return date; or
      
   3. The rental car company discovers that the vehicle has been stolen or abandoned and, if stolen, reports the vehicle stolen to law enforcement by filing a stolen vehicle report. (Civil Code, § 1936, subd. (n)(1)(i)-(iii).)

FISCAL EFFECT:

Unknown

COMMENTS:

1. Author's Statement: According to the author, “AB 2169 is a win for everyone—the consumer whose identity is in the process of getting stolen, the rental industry, and the law enforcement. This bill works to create transparency and efficiency in the rental car industry. AB 2169 not only updates the outdated process of reporting, but it addresses a problem that occurs across our state.”
   
2. Inconsistency with Other Laws: California prohibits rental car companies from tracking vehicles with global positioning technology (GPS) devices, except in a few narrowly defined situations. Current law prohibits GPS information from being accessed without the customer’s consent unless the vehicle is missing, abandoned, or stolen, or the customer fails to return the vehicle within one week of the contracted return date. In contrast, under current law the vehicle can be presumed to be embezzled after five days, two days less than when the GPS device can be activated.
   
   Notably, AB 2051 (O’Donnell), Chapter 183, Statutes of 2016, would have allowed rental car companies to track missing cars with global positioning technology (GPS) after three days, but that provision was deleted from the bill. And yet this bill shortens the time for the presumption of embezzlement to 48 hours, thereby increasing the time difference between the two. It raises the question of whether these two time limits should be reconciled.
   
3. Argument in Support: According to the California Police Chiefs Association, “Over the last several years, theft of rented vehicles has increased substantially in cities across California, and it is now more important than ever for rental car companies to report possible thefts to law enforcement immediately in order to increase the probability that the stolen vehicle is located and returned.”
   
4. Argument in Opposition: According to Public Good Law Center, “Under this bill, hundreds of thousands of people who live in or visit California would be subjected to criminal prosecution and penalties, including prison time, for the ‘crime’ of keeping their rental car beyond the designated return time. That behavior – as even the most casual conversation with a rental car agency employee will confirm – is widespread. Renters often keep rented cars beyond the limit, and as a result must pay additional rental charges and other fees as provided by their rental contract; there is no need for them to face the additional prospect of being hauled off to jail by the police.
   
   “Why would the voters of California want to make the police the collections arm of the rental car industry? And why would the taxpayers of California want to foot the bill for the additional police, judicial, and prison expenses that would be incurred?
   
   “The United States Supreme Court has already had to intervene to ensure that Vehicle Code section 10855 as written comports with due process. See Carella v. California, 491 U.S. 263 (1989) (holding jury instructions written to comport with statute were unconstitutional). There is no call to make the statute even less likely to comport with the Constitution, and it would be reckless for the state to move in that direction.
   
   “When section 10855 was adopted in 1959, the Legislature determined that criminality cannot be determined immediately upon the lapse of the rental period, but rather that a 5-day period is necessary to distinguish (1) renters who are delayed or distracted or incapacitated or even lazy from (2) people acting with criminal intent to steal a rental car. When nearly half a century later the Legislature enacted Civil Code section 1936(n) (relating to the use of electronic surveillance equipment in rental cars), it determined that the necessary period for determining that a vehicle had actually been stolen was a full week (and even then only if the rental company had filled out a police report). (See AB2840 (2004), Sen. Judic. Committee Analysis (“allowing rental companies to use the technology if a reasonable time period has elapsed since the car was due to be returned (such as a week)”); available at https://leginfo.legislature.ca.gov/faces/billAnalysisClient.xhtml?bill_id=200320040AB2840.) Rental car companies supported that bill. (See ibid., Sen. Floor Analysis (showing rental car companies in support).)
   
   “When the Legislature recast and renumbered the rental car law just two years ago, it decided explicitly to keep the one week period rather than shortening it to three days. (Compare Civ. Code § 1939.23 in AB 2051 (chaptered) with AB 2051 (4/4/16) (as amended in Assembly).) There is nothing in the record here to suggest that this reasoned assessment has become somehow outdated or is no longer relevant. To the contrary: California faces a crisis of over-incarceration and the last thing we need to do is to add to the problem.
   
   “Even the superficially sensible provision in the current bill allowing rental companies to declare a car stolen upon being notified that it was “procured by fraud” – i.e., that there is a problem with the renter’s credit card – looks less reasonable upon reflection: What if the problem is simply that the card has expired or that the renter has had her credit card number stolen and used improperly? (Is the industry proposing that any time any of us faces these annoyances during a car rental we should be deemed an embezzler and arrested?) For that matter, even if there are indications that the renter is using a credit card number that is not hers, that is an indication that the card may be stolen, not the car. It is a decision for the credit card company, not the rental car company, to instigate an investigation.”
   
5. Related Legislation: SB 916 (Weiner) changes the definition of auto burglary. SB 916 will be heard in the Senate Public Safety Committee today.
   
6. Prior Legislation:
   
   1. AB 495 (Voepel), of the 2017-2018 legislative session, would have made it a felony for a person, without consent, to rent a vehicle using another person’s personal identifying information or another person’s access card or access card account information. AB 495 was referred to the Assembly Public Safety Committee and its hearing was canceled at the request of author.
      
   2. AB 2051 (O'Donnell), Chapter 183, Statutes of 2016, reorganized the statute regulating rental car agreements and modifies certain regulations that no longer reflect prevailing practices in consumer and industry behavior. AB 2051 would have allowed rental car companies to track missing cars after three days, but that provision was deleted from the bill.
      
   3. AB 2804 (Corbett), Chapter 317, Statutes of 2004, prohibits a rental car company from using, accessing or obtaining information relating to the renter's use of the rental vehicle that was obtained using GPS technology except in specified circumstances, including, among others, when the vehicle is stolen.
      

REGISTERED SUPPORT / OPPOSITION:

Support

California Police Chiefs Association

Opposition

Public Good Law Center

Analysis Prepared by:

Sandy Uribe / PUB. S. / (916) 319-3744