Is the registered owner on the hook for impound?

A relative got into a sticky situation.. A bit over a year ago, the relative told a neighbor that he could take a non-running vehicle as compensation for some fencing work that he did. The relative signed the back of the ownership, but did not prepare a bill of sale (since the car was a "gift") and neglected to take off the plates.

Fast forward to a couple of weeks ago.. A couple of cops showed up investigating a hit and run. After being very cooperative and explaining the situation both to them and to the insurance adjuster of the hit and run victim, the relative figured "lesson learned, case closed."

Well today, the relative received a notice of intention to sell from an impound lot, including the threat that they would be on the hook for any storage/impound fees going above what they get after selling the vehicle.

Here are my questions about this situation?

1) What would be the best way to deal with this? Calling the impound lot or just waiting for the subpoena? [note: they put down the right make but wrong model for the vehicle (like Camry instead of Corolla)]

2) If they decide to take the registered owner to small claims court, would the registered owner's side of the story, along with a notarized statement from the neighbor in question that he gave/sold the vehicle to ___insert name here___ with the understanding that they would transfer the ownership to themselves, within the legally prescribed amount of time be enough to make a case for the defendant?

3) What should the registered owner do to recover the plates? Just show up at the lot with the plate portion of the vehicle?

4) Can the registered owner be on the hook for any collision damage?

5) Any other relevant information/options/thoughts on the situation that you have would be appreciated.

P.S. The registered owner will in the future make out a bill of sale for every vehicle transfer and make sure that the plates are off the vehicle before the new owner takes possession, so comments on that topic are unnecessary.

Not fact but, with the signed ownership the car is no longer your relatives. This was a trade for services. The other person know of this, however without a lot of paperwork it's hard to prove. The "other" guy did not register it under his name so that leaves your relative to explain the situation to all involved. He may have to get a copy of the police report to avoid the claim by the impound yard.

The additional issue is that the interaction with the police involved proving that the registered owner was out of town when the incident happened and while the make of the relative's current vehicle was mentioned, I'm not sure if it made it into the notes. The only person who received a fully detailed account of the circumstances was the victim's insurance adjuster.

Therefore the only paperwork the relative could provide would be a notarized statement from the neighbor.

very interesting......wonder how it will play out in the end.

if I was the tow place I would get an MTO document showing who "owned" the vehicle on the day brought into the compound and use that. To pursue costs.

then have the registered owner try and recover costs from who bought the vehicle

let us know the outcome, very curious

Will do. On a good note, the insurance adjuster is up-to-date on the whole issue and if the cops who dropped by a few weeks ago decide to call back, they'll have a full update.

So far, I've just heard a bunch of horror stories from people left on the hook for towing/impound and/or 407 fees.

The neighbor promised to contact his buyer, have the impound situation sorted out, get a receipt and obtain the plates by tomorrow. We'll see what'll happen. The relative can always call the adjuster and the local division of the TPS is almost within walking distance in case there are any issues.