MOTOR VEHICLES ‑- FINANCIAL RESPONSIBILITY ‑- COLLATERAL AS PROOF ‑- REQUISITES.
The operator of a motor vehicle who has had his license suspended makes the necessary proof of ability to respond in damages required under the financial responsibility act by presenting a certificate of the state treasurer showing that there has been deposited with him collateral approved by him in the amount of $11,000, based upon the same standards imposed by statute as acceptable security for state deposits.
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October 31, 1958
Honorable Louise S. Taylor
Director of Licenses
General Administration Building
Olympia, Washington Cite as: AGO 57-58 No. 225
Attention: !ttMr. A. C. Bertocchini, Administrator
Financial Responsibility Division
Dear Mrs. Taylor:
We acknowledge receipt of your inquiry relative to the nature of deposits which may be made for the purpose of establishing proof of ability to respond in damages under the financial responsibility act (chapter 46.24 RCW). The questions involved are the following:
(1) May a person who is required to establish proof of ability to respond under the financial responsibility act do so by the deposit of collateral?
(2) If so, what type of collateral is acceptable?
We answer your first question in the affirmative, and your second question in our analysis.
[[Orig. Op. Page 2]]
The operator in question has had his license suspended under the provisions of RCW 46.24.030 following conviction or bail forfeiture for an offense which required suspension. The period of suspension has expired, and the operator desires to qualify for reinstatement of his operator's license by posting collateral. Proof of financial responsibility must be made and maintained for a period of three years from the date proof was required in order to qualify this operator for reinstatement of his license. (RCW 46.24.150)
RCW 46.24.070 sets out how such proof of ability to respond in damages may be established, and provides that it may be evidenced:
(1) By certificate from an insurance carrier that the operator is covered by liability insurance in the prescribed amounts;
(2) By a bond conditioned for payment in the required amounts;
(3) By a certificate of the state treasurer showing deposit of money or collateral approved by him in the required amounts.
In this specific case, the applicant desires to deposit collateral. This is permissible under the specific provisions of RCW 46.24.070. The amount required is $11,000 (RCW 46.24.040). The principal problem is the nature of the collateral which may be deposited inasmuch as the statute prescribes no specific standards.
There are other statutes, however, which do prescribe the type of collateral which the state treasurer shall accept as security for state deposits (RCW 43.85.030 (1955 Supp.)). In general, these are limited to general obligation bonds and warrants of the United States, the state and political subdivisions, many of which must be payable from general ad valorem tax levies. We believe that the collateral which he may accept as a deposit to meet the requirements of the financial responsibility act should meet these same requirements.
In explanation, if money were deposited with the treasurer to meet the requirements of RCW 46.24.070, the treasurer would be required to secure collateral from the state depositary with which it was deposited, meeting the statutory requirements of RCW 43.85.030. Consequently, it seems logical that the collateral that the person seeks to deposit as proof of his ability to respond in damages under the financial responsibility act should meet the same requirements which the state treasurer would require of its depositary.
[[Orig. Op. Page 3]]
We conclude, therefore, under the circumstances above mentioned, that an operator whose license has been suspended meets the statutory requirements for proof of ability to respond in damages by presenting a certificate of the state treasurer showing that there has been deposited with him collateral approved by him in the amount of $11,000, based upon the same standards for collateral imposed by statute as security for state deposits.
We trust that this information will be of assistance to you.
Very truly yours,
JOHN J. O'CONNELL
Assistant Attorney General