NY State Senate Bill 2023-S9610

Senate Bill S9610

2023-2024 Legislative Session

Relates to the enforcement of liens by sale of the occupant's goods that remain in a self-storage facility

download bill text pdf

Current Bill Status - In Senate Committee Judiciary Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
May 16, 2024	referred to judiciary

2023-S9610 (ACTIVE) - Details

Current Committee:: Senate Judiciary
Law Section:: Lien Law
Laws Affected:: Amd §182, Lien L

2023-S9610 (ACTIVE) - Summary

Permits the sale of goods that remain in a self-storage facility to enforce a lien by the facility through a public website, pursuant to notice requirements.

2023-S9610 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S9610

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act to amend the lien law, in relation to enforcement of liens by
online sale of goods that remain in a storage facility

 
PURPOSE OR GENERAL IDEA OF BILL:

To modernize the lien sale system by codifying online sales and adver-
tising and allowing an operator the option to have an abandoned motor
vehicle towed rather than sold at a lien sale.

 
SUMMARY OF PROVISIONS:

Section one makes various changes to Section 182 of the Lien Law includ-
ing codifying the common practice of conducting online auctions for
public lien sales. It also permits advertising of lien sales online and
requires an online ad to be posted with all relevant information for the
sale ten days prior to a sale on a site that regularly advertises public
lien sales. This section also provides an option for the property owner

to have the vehicle towed instead of selling it at a lien sale, provided
that they notify the occupant via verified or electronic mail identify-
ing the towing company that will perform the towing and the address
where the towed property can be redeemed.

Section two sets the effective date.

 
JUSTIFICATION:

Self-storage facilities are governed under Section 182 of the Lien Law,
which grants the facility owner a lien on the property stored at the
self-storage facility for rental fees owed to them by the occupant. In
the event that the occupant is unable to pay the monthly fees, the self-
storage facility owner has the right, subject to compliance with certain
procedural requirements, to conduct a sale of the items to defray
outstanding and unpaid fees.

Section 182 of the Lien Law does not expressly state that lien enforce-
ment sales are permitted to take place online. Historical practice was
to conduct auctions in front of the storage units with groups of bidders
and a physical auctioneer on site to officiate the process. Over the
last few years, however, it has become common to hold auctions online.
Because Lien Law Section 182 is silent on this matter, it is left to
court interpretation as to whether an online auction meets the standard
of "commercially reasonable" provided in such section.

This bill would modernize this aspect of the law by amending Section 182
to explicitly allow online advertising and online auctions. This expands
upon the sole existing option for advertising of upcoming lien sales in
Section 202 of Lien Law, which mandates that the sale must be advertised
in a newspaper that is published in the town or city where the sale is
to be held once per week for two consecutive weeks.

Newspaper circulation has gone down in recent years, leaving lien sales
with fewer bidders, less competition, and lower bids which in turn means
less proceeds to offset unpaid occupant debt. Providing an online option
for both advertising and the auctions themselves would drive more poten-
tial bidders to sales and would align New York with the 28 other states
that expressly permit online auctions in their self-storage lien laws.

This bill would also explicitly provide an option for a property owner
to have a motor vehicle towed from a storage space rather than selling
it at a lien sale. Towing operators are accustomed to handling abandoned
vehicles and better understand the process to search for other lien
holders on the vehicle. This experience could potentially help the stor-
age client avoid damaging their credit rating by allowing the vehicle to
be returned to the other lien holder.

 
PRIOR LEGISLATIVE HISTORY:

None

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after it shall have
become a law.

2023-S9610 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9610
 
                             I N  S E N A T E
 
                               May 16, 2024
                                ___________
 
 Introduced by Sen. GOUNARDES -- read twice and ordered printed, and when
   printed to be committed to the Committee on Judiciary
 
 AN  ACT  to  amend  the lien law, in relation to enforcement of liens by
   online sale of goods that remain in a storage facility
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Subdivision 7 of section 182 of the lien law, as amended by
 chapter 424 of the laws of 2019, is amended to read as follows:
   7.  Enforcement of lien. (a) An owner's lien may be enforced by public
 or private sale of the occupant's goods that remain in the  self-storage
 facility,  in  block,  or  in  parcel,  at any time or place, WHETHER IN
 PERSON OR THROUGH A PUBLIC WEBSITE, and on any terms which  are  commer-
 cially reasonable after notice to all persons known to claim an interest
 in  the  goods.  The  notice  shall include an itemized statement of the
 amount due, the description of the property subject  to  the  lien,  the
 nature  of  the  proposed  sale, a demand for payment within a specified
 time not less than thirty days from mailing of the notice and a conspic-
 uous statement that unless the claimant pays within that time the  goods
 will  be  advertised  for  sale  and sold at public or private sale in a
 commercially reasonable manner. The notice  shall  further  include  the
 time and place, OR THE WEB ADDRESS, of any public or private sale and it
 shall  state  that any person claiming an interest in the goods is enti-
 tled to bring a proceeding hereunder within ten days of the  service  of
 the  notice  if  [he disputes] THEY DISPUTE the validity of the lien, or
 the amount claimed. The notice shall be: (I) personally delivered to the
 occupant, or (II) sent by registered or certified mail to the occupant's
 last known address, or (III) sent by verified mail and  electronic  mail
 to  the  occupant's last known address. Any notice made pursuant to this
 section and sent by verified mail  shall  be  sent  to  the  last  known
 address provided by the occupant, pursuant to the occupancy agreement.
   (B)  Any  notice  made pursuant to this section and sent by electronic
 mail shall only be effective if: (i) the occupancy agreement states that
 the occupant has consented to receive late or lien notices by electronic
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD15595-01-4

 S. 9610                             2
 
 mail; and (ii) the occupant has provided the occupant's electronic  mail
 address in at least two locations within the occupancy agreement.
   [(b)]  (C)  Any notice given pursuant to this section is deemed deliv-
 ered when it is[: (i)] properly addressed to the last known address, and
 [(ii)] either sent by (I) registered, certified  or  verified  mail  and
 evidence  of  mailing  is  received, or (II) sent by electronic mail and
 either a non-automated response to the electronic mail is received or  a
 receipt of delivery to the electronic mail is received.
   (D)  ANY SALE IS PROPERLY ADVERTISED PURSUANT TO THIS SUBDIVISION WHEN
 THE ADVERTISEMENT IS PUBLISHED: (I) IN PRINT IN A NEWSPAPER  OF  GENERAL
 CIRCULATION  IN  THE AREA WHERE THE SELF-STORAGE FACILITY IS LOCATED, OR
 (II) ON A PUBLICLY ACCESSIBLE WEBSITE  THAT  REGULARLY  ADVERTISES  SUCH
 SALES,  AT  LEAST TEN DAYS PRIOR TO THE DATE OF THE SALE. ANY ADVERTISE-
 MENT UNDER THIS SUBDIVISION SHALL INCLUDE THE ADDRESS OF  THE  SELF-STO-
 RAGE  FACILITY,  THE  NAME  OF THE TENANT, AND THE DATE, TIME, PLACE AND
 MANNER OF SALE.
   (E) NOTWITHSTANDING ANY LAW, RULE OR REGULATION TO  THE  CONTRARY,  IF
 THE PROPERTY UPON WHICH THE LIEN IS CLAIMED IS A MOTOR VEHICLE OR WATER-
 CRAFT  AND RENT AND OTHER CHARGES RELATED TO THE PROPERTY ARE IN DEFAULT
 FOR SIXTY CONSECUTIVE DAYS, THE OWNER MAY HAVE THE PROPERTY TOWED. IF  A
 MOTOR  VEHICLE  OR  WATERCRAFT IS TOWED AS AUTHORIZED BY THIS PARAGRAPH,
 THE OWNER SHALL: (I) SEND, BY VERIFIED OR ELECTRONIC MAIL TO  THE  OCCU-
 PANT'S  LAST  KNOWN  ADDRESS, THE NAME, ADDRESS, AND TELEPHONE NUMBER OF
 THE TOWING COMPANY THAT WILL PERFORM THE TOWING AND THE  STREET  ADDRESS
 OF  THE  STORAGE  FACILITY WHERE THE TOWED PROPERTY CAN BE REDEEMED; AND
 (II) NOT BE LIABLE FOR THE MOTOR VEHICLE OR WATERCRAFT OR ANY DAMAGES TO
 THE MOTOR VEHICLE OR WATERCRAFT ONCE THE TOWING COMPANY TAKES POSSESSION
 OF THE PROPERTY.
   § 2. This act shall take effect on the thirtieth day  after  it  shall
 have become a law.

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