BILL NUMBER:  S1102A

 TITLE OF BILL :  An act to amend the lien law, in relation to liens
on self-service storage facilities

 PURPOSE OR GENERAL IDEA OF BILL :

The purpose of the bill is to provide greater protection for the
occupants of self-service storage facilities by strengthening the
notice requirement in relation to the lien sale.

 SUMMARY OF PROVISIONS :

Section 1 of the bill amends subdivision 7 of section 182 of the lien
law to require two notices be provided to the occupants as well as an
alternative contact person prior to conducting a lien sale. It
requires that the second notice be personally delivered or sent
between five and ten days after the first notice has been delivered.
The occupants will have at least 30 days from the receipt of the
second notice to pay the amount due or bring a special proceeding to
dispute the validity of the lien or the amount claimed.

Section 2 of the bill amends subdivision 2 of section 182 of the lien
law by adding a new sentence to paragraph (c), requiring every
occupancy agreement to state conspicuously that the occupant's
personal property in a leased space will be subject to a claim of lien
              

and can be sold to satisfy the lien if he/she defaults or fails to pay
rent for the storage of personal property abandoned after the
termination of the agreement. It also adds a new paragraph (d) to
require that every occupancy agreement to ask for the name and address
of another person to whom the required notices may be sent.  However,
failure of an occupant to provide an alternative address shall not
affect an owner's remedies under this section or under any other
provision of law.

Section 3 provides for this act to take effect January 1, 2019.

 JUSTIFICATION :

In recent years, storage auctions have gained much popularity as a
result of televisions shows such as Storage Wars and Auctions Hunters
where bidders uncover treasures and antiques that are worth thousands
of dollars. These shows have not only increased awareness of storage
auctions, but also attracted more people to participate in the auction
process in the hope that they too will find valuable items.  Given the
increased demand for storage auctions, it has became even more
important to ensure that storage unit occupants are given sufficient
notice to recover their personal property before it is auctioned off.

Under the Lien Law, self-service storage facility owners have lien
enforcement rights to collect overdue fees and to recover their
storage space from delinquent occupants by conducting a lien sale of
their personal property. Unlike most auctions, where a bid is placed
on a single item, it is a usual commercial practice for bidders in
storage unit auction to bid on the entire contents of the unit. Prior
to conducting this auction, storage facilities owners are required to
deliver a pre-lien notice to the occupant, stating that the goods will
be advertised for sale and sold at public or private sale unless
he/she pays within a specified time, that are not less than 10 days.
However, the problem arises when this one-time notice is not properly
delivered to the occupant. Since storage auctions can allow the sale
of the entire contents of the unit without inspecting and inventorying
each item, occupants may be unfairly prejudiced if they do not receive
the notice, especially when the stored property includes valuable
items. In addition, the current law provides only 10 days for the
occupant to bring a special proceeding upon the service of the notice
to dispute the validity of the lien or the amount claimed. For people
who are unfamiliar with the legal proceeding, 10 days may not give
them enough time to file the necessary paperwork to initiate the
proceeding.

In order to prevent premature and wrongful sale of property, the
legislation strengthens the notice requirement in relation to the
owner's enforcement rights. Under this bill, the occupancy agreement
must include a conspicuous notice that the occupant's personal
property in the leased space will be subject to a claim of lien and
can be sold to satisfy the lien upon default of abandonment of the
stored items. In addition, the owner must make two attempts to contact
the occupant as well as any alternative person that the occupant lists
in the occupancy agreement. The bill allows at least 30 days from the
receipt of the second notification for the occupants to cure the
default by paying the outstanding fees. Furthermore, it extends the
time limit for bringing special proceeding from 10 days to 30 days of
the service of the second notice.

 PRIOR LEGISLATIVE HISTORY :

None

 FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS :

None known.

 EFFECTIVE DATE :
This act shall take effect January 1, 2019.