Public Consignment Auction Dealer ($100,000) Bond - Statewide in Arizona

Brief Summary

Arizona sets the public consignment auction dealer bond at the top of its dealer scale, $100,000, and counts it per county. A surety bond lets an auction house meet that figure for each county where it has a place of business without holding six figures of cash against every location.

Arizona Administrative Code R17-5-402 sets the bond for a public consignment auction dealer license at $100,000, and requires a separate, original bond for each county in which the dealer has an established place of business. Under A.R.S. 28-4362 the bond names the State of Arizona as obligee, must be on a form approved by the ADOT director, and protects people who lose money when the dealer fails to pay prepaid title, registration or related fees or taxes, or fails to deliver a clean title.

We can help with all Arizona bonds!

How to Apply for a Public Consignment Auction Dealer ($100,000) Bond:

• Identify every county where you will have an established place of business. Each one needs its own bond.
• Confirm the site qualifies as an established place of business under A.R.S. 28-4301, a permanent enclosed building owned or leased with room to display two or more vehicles.
• Complete the bond application with a surety authorized in Arizona.
• Receive each original $100,000 bond with the surety's embossed stamp, seal or sticker. Handwritten bonds are refused.
• Submit the bond with the ADOT dealer license application and the filing fees set by A.R.S. 28-4302.
• Include a copy of the current transaction privilege tax license.

Detailed Information About the Arizona Public Consignment Auction Dealer ($100,000) Bond:

Count your counties

The $100,000 figure is not a single statewide bond. R17-5-402 requires a separate, original bond for each application and for each county in which an applicant or licensee has an established place of business. An auction house with sites in two counties files two $100,000 bonds.

Public consignment versus wholesale

R17-5-402 puts public consignment auction dealers in the same $100,000 tier as new and used motor vehicle dealers. Wholesale auction dealers, brokers and wholesale dealers sit at $25,000. A.R.S. 28-4301 defines a public consignment auction dealer as one that conducts live auctions with a licensed auctioneer verbally calling for and accepting bids, and provides live auction services to the public on a consignment contract basis, at its established place of business or an authorized off premises location. A wholesale motor vehicle auction dealer sells only to licensed dealers and does not buy, sell or own the vehicles it auctions. Selling to the public puts you in the higher tier.

What the bond pays for

A.R.S. 28-4362 says the bond protects any person who suffers a loss because the dealer did not pay customer prepaid title, registration or other related fees or taxes, or did not deliver a valid title certificate free and clear of prior owner interests and liens, other than a lien the buyer created or assumed in writing. For a consignment business handling titles for both sellers and buyers, those are the two exposures that matter most.

Form and filing rules

The bond must be on a form approved by the director, written by a surety authorized to do business in Arizona, with the applicant as principal and the state as obligee. It can be cancelled only on at least sixty days' prior notice to the director. ADOT requires an embossed stamp, seal or sticker from the bond company and will not accept a handwritten bond. The application also needs the filing fees under A.R.S. 28-4302 and a copy of the dealer's current transaction privilege tax license.

Eligibility and Requirements for a Arizona Public Consignment Auction Dealer ($100,000) Bond:

• Obligee: State of Arizona, on a bond form approved by the ADOT director.
• $100,000 for each county with an established place of business.
• Surety authorized to transact business in Arizona.
• Cancellation only on at least sixty days' prior notice to the director.
• Live auctions called by a licensed auctioneer, with services offered to the public on a consignment contract basis.

Arizona Public Consignment Auction Dealer ($100,000) Bond FAQs:

Official and Additional Resources for the Arizona Public Consignment Auction Dealer ($100,000) Bond: