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If the driver isn't licensed (or isn't sober), the cops are not supposed to let him drive away. Unless the driver can have someone else (licensed & sober) drive the car for him, the police will PROBABLY have it impounded. The alternative is leaving the car by the side of the road where it can be damaged or stolen (or the unqualified driver might come back for it).
Going back to the question of bill of sale, the license tags on the car are recorded for the owner of record. Offering the cops a document that conflicts with the official DMV records of ownership is probably going to result in inconvenience and maybe worse. If you're driving a car for which you are not the registered owner, I suggest not only carrying the bill of sale (although that might not do the trick) but also carrying your proof of insurance; one of the few reasons I can think of for a new owner using the old tags and not registering his purchase is that he hasn't bothered to get the requisite insurance.
The MSO, incidentally, is essentially the first pink slip for a new car -- the presentation of the MSO is an assurance that you are the first owner, that it was not previously owned. The first owner trades the MSO for his pink slip and from then on the chain of owners is by pink slip.
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