HB84 By Representative Brown RFD State Government Rd 1 03-MAR-15

SYNOPSIS: Under existing law, the Self-Service Storage Act regulates the rental of individual storage spaces for personal property in the state.

This bill would provide further for the definitions of last known address and self-service storage facility and to define active duty, email, late fee, service member, and verified mail.

This bill would authorize an owner to notify an occupant of default and the intent of the owner to enforce a lien by verified mail or email.

This bill would delete the requirement that the notice include a description of the property and a denial of access to the property.

This bill would permit posting the notice of sale or other disposition of the property on a publicly accessible website.

This bill would specify what constitutes a commercially reasonable sale and proceeds, determining the maximum value of stored property, and the transfer of liability for a towed motor vehicle or vessel.

This bill would also provide for the imposition of a late fee and for additional time before an owner's lien may be enforced against a defaulting occupant who is a member of the armed forces.

A BILL TO BE ENTITLED AN ACT

To amend Sections 8-15-31 and 8-15-34, Code of Alabama 1975, and to add Sections 8-15-39 and 8-15-40 to the Code of Alabama 1975, relating to the Self-Service Storage Act; to provide further for definitions; to authorize an owner to notify an occupant of default and the intent to enforce a lien by verified mail or email; to delete the requirement that notice include a property description and a denial of access to the property; to specify what constitutes a commercially reasonable sale and proceeds, determines the maximum value of stored property, and the transfer of liability for a towed motor vehicle or vessel; to provide for the imposition of a late fee; and to require additional time before an owner's lien may be enforced against a defaulting occupant who is a member of the armed forces.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 8-15-31 and 8-15-34 of the Code of Alabama 1975, are amended to read as follows:

§8-15-31.

"For the purposes of this article, the following words and phrases shall have the respective following meanings ascribed by this section:

"(1) ACTIVE DUTY. Active military duty pursuant to an executive order of the President, Act of Congress, or order of the Governor.

"(1) (2) DEFAULT. The failure to perform in a timely manner any obligation or duty set forth in this article or the rental agreement.

"(3) EMAIL. An electronic message or an executable program or computer file that contains an image of a message that is transmitted between two or more computers or electronic terminals including electronic messages that are transmitted within or between two computer networks.

"(2) (4) LAST KNOWN ADDRESS. That The street address, post office box, or email address provided by the occupant in the latest most recent rental agreement or the address provided by the occupant in a subsequent written notice of a change of address by hand delivery, verified mail, or email accompanied by a receipt.

"(5) LATE FEE. A reasonable fee or charge that is assessed by the owner for the failure of the occupant to pay rent when due. A late fee is not interest on a debt or a reasonable expense which the owner may incur in the course of collecting unpaid rent in enforcing the lien rights of the owner.

"(3) (6) LEASED SPACE. The individual storage space at the self-service storage facility which is leased or rented to an occupant pursuant to a rental agreement.

"(7) MOTOR VEHICLE. A motor vehicle as defined in Section 32-8-2.

"(4) (8) OCCUPANT. A person or entity, or his or her sublessee, successor, or assign, entitled to the use of a storage space at a self-service storage facility, under a written rental agreement with the owner, to the exclusion of others.

"(5) (9) OWNER. The owner, operator, lessor, or sublessor of a self-service storage facility, his or her agent, or any other person authorized by him or her to manage the facility or to receive rent from an occupant under a rental agreement.

"(6) (10) PERSONAL PROPERTY. Movable property not affixed to land. This term includes, but is not limited to, goods, merchandise, and household items.

"(7) (11) RENTAL AGREEMENT. Any written agreement or lease which establishes or modifies the terms, conditions, rules, or any other provisions concerning the use and occupancy at a self-service storage facility and which contains a notice stating that all articles stored under the terms of such agreement will shall be sold or otherwise disposed of if no payment has been received for a continuous 30-day 15-day period. Such The agreement shall contain a provision directing the occupant to disclose any lienholders with an interest in property that is stored or will be stored in such the self-service storage facility.

"(8) (12) SELF-SERVICE STORAGE FACILITY. Any real property designed and used for the purpose of renting or leasing individual storage space to occupants who are to have access to such the facility for the purpose of storing and removing personal property. No occupant shall use a self-service storage facility for residential purposes. A self-service storage facility is not a public warehouse as used defined in Article 1 of this chapter. If an owner issues any warehouse receipt, bill of lading or other document of title for the personal property stored, the owner and the occupant are subject to the provisions of Article 7 of the Uniform Commercial Code, and the provisions of this article shall not apply. The commercial landlord and tenant relationship between owner and occupant is not altered by retention by the owner of a key provided by the occupant.

"(13) SERVICE MEMBER. A member of the Armed Forces of the United States, a reserve branch of the armed forces, or the National Guard.

"(14) VERIFIED MAIL. First class mail that is offered by the United States Postal Service that provides evidence of mailing.

§8-15-34.

"An owner's The lien of an owner as provided for a claim which has become due may be satisfied as follows:

"(1) No enforcement action, other than denial of access, shall be taken by the owner until the occupant has been in default continuously for a period of 30 15 days.

"(2) Prior to taking enforcement action pursuant to this section, the owner shall determine whether a financing statement has been filed in accordance with Title 7 concerning the property to be sold or otherwise disposed of, with the Secretary of State, in the county where the self-service storage facility is located and in the county of the occupant's last known address of the occupant, or if the property includes a motor vehicle, the owner also shall determine whether a lien has been filed with the Alabama Department of Revenue.

"(3) After the occupant has been in default continuously for a period of 30 days, the owner may begin enforcement action if the occupant has and any lienholder have been notified in writing. Said notice The occupant shall be notified of the intent of the owner to enforce his or her lien by written notice delivered in person or sent by or registered, by verified mail, or by email to the last known address of the occupant. Any lienholder with an interest in the property to be sold or otherwise disposed of, of whom the owner has knowledge either through the disclosure provision on the rental agreement or through finding a validly filed financing statement in the office of the Secretary of State's office State, or county, or if the property includes a motor vehicle, through a lien filed with the Alabama Department of Revenue, shall be included in the notice process as provided in this section. In addition, the notice shall be forwarded by certified mail, with either return receipt requested or electronic delivery confirmation, to any lienholder. The notice to any lienholder shall include a description of the property covered by the lien including, without limitation, the name and address of the owner of the property covered by the lien, and the make, model, year, and vehicle identification number of any motor vehicle to the extent this information is set forth in a filed financing statement or a lien filed with the Alabama Department of Revenue.

"(4) The owner shall have the right to may deny the occupant access to the leased space and the owner may enter and/or or remove, or both, the personal property from the leased space to other suitable storage space pending its sale or other disposition.

"(5) The notice required by this section shall include all of the following:

"a. An itemized statement of the owner's claim of the owner showing the sum due at the time of the notice and the date when the sum became due;.

"b. A brief and general description of the personal property subject to the lien. Such description shall be reasonably adequate to permit the person notified to identify such property; except that any container including, but not limited to, a trunk, valise, or box that is locked, fastened, sealed, or tied in a manner which deters immediate access to its contents may be described as such without describing its contents;

"c. A notification of denial of access to the personal property, if such denial is permitted under the terms of the rental agreement, which notification shall provide the name, street address, and telephone number of the owner or his designated agent whom the occupant may contact to respond to such notification;

"d. b. A demand for payment within a specified time, not less than 15 days after delivery of the notice;.

"e. c. A conspicuous statement that, unless the claim is paid within the time stated in the notice, the personal property will shall be advertised for sale or other disposition and will be sold or otherwise disposed of at a specified time and place.

"(6) Any A notice made given pursuant to this section shall be presumed delivered when it is deposited with the United States postal service and properly addressed with postage prepaid or transmitted by email to the last known email address of the occupant. Notice to lienholders evidenced by a filed financing statement or a lien filed with the Alabama Department of Revenue shall be in writing and served upon the lienholder by hand delivery or certified mail, with either return receipt requested or electronic delivery confirmation.

"(7) After the expiration of the time given in the notice expires, if the owner determines, based on the previous experience of the owner, that the personal property subject to the lien has a value of five hundred dollars ($500) or less, the owner may dispose of the property at his or her sole discretion.

"(7) (8) After the expiration of the time given in the notice, an advertisement of the sale or other disposition shall be published once a week for two consecutive weeks in a newspaper of general circulation in the county where the self-service storage facility is located. The advertisement shall include:

"a. A brief and general description of the personal property reasonably adequate to permit its identification as provided in paragraph (5)b. of this section; the that is the subject of the lien that is reasonably adequate to permit its identification. The address of the self-service storage facility and the number, if any, of the space where the personal property is located; and the name of the occupant; and his last known address; the name and address of any lienholder.

"b. The time, place, and manner of the sale or other disposition. The sale or other disposition shall take place not sooner than 15 days after the first publication.

"(8) (9) If there is no newspaper of general circulation in the county where the self-service storage facility is located, the advertisement shall be posted on the premises in a conspicuous location, or publicly accessible website, at least 10 days before the date of the sale or other disposition in not less than six conspicuous places in the neighborhood where the self-service storage facility is located.

"(9) (10) Any sale or other disposition of the personal property shall conform to the terms of the notification as provided for in this section.

"(10) (11) Any sale or other disposition of the personal property shall be held at the self-service storage facility or at the nearest suitable place where the personal property is held or stored. The property may be sold singly, in lots or as a whole. Bids may be sealed or open. A sale held on a publicly accessible website that regularly conducts Internet self-storage auctions shall be considered a sale held at the self-service storage facility.

"(11) (12) Before any sale or other disposition of personal property pursuant to this section, the occupant may pay the amount necessary to satisfy the lien and the reasonable expenses incurred under this section and thereby redeem the personal property. Upon receipt of such payment, the owner shall return the personal property, and thereafter the owner shall have no liability to any person with respect to such the personal property.

"(12) (13) A purchaser in good faith of the personal property sold to satisfy a lien as provided in this article takes the property free of any rights of persons against whom the lien was valid, despite noncompliance by the owner with the requirements of this section.

"(13) (14) In the event of a sale under this section, the owner may satisfy his or her lien from the proceeds of the sale. The lien rights of secured lienholder(s) lienholders are automatically transferred to the remaining proceeds of the sale. If the sale is made in good faith and is conducted in a commercially reasonable manner, the owner shall is not be subject to any liability for a deficiency if the amount realized at sale does not satisfy any secured lien, but shall hold the balance, if any, for delivery to the occupant, lienholder, or other person in interest. If the occupant, lienholder, or other person in interest does not claim the balance of the proceeds within three years of the date of sale, it shall become the property of the owner without further recourse by the occupant, lienholder, or other person in interest.

"(14) (15) If the requirements of this article are not satisfied, if the sale of the personal property is not in conformity with the notice of sale, or if there is a willful violation of this article, nothing in this section affects the rights and liabilities of the owner, occupant, or any other person.

"(16) If the property is sold by public sale and three or more bidders, who are unrelated to the owner, are in attendance at the sale, the advertisement, sale, and the proceeds from the sale are deemed commercially reasonable.

"(17) If the rental agreement contains a limit on the value of the property stored in the storage space of the occupant, the limit is the maximum value of the property stored in the space.

"(18) If the property upon which the lien is claimed is a motor vehicle or a vessel, and rent and other charges related to the property remain unpaid or unsatisfied for 60 days following the maturity of the obligation to pay rent, the owner may have the property towed in lieu of foreclosing on the lien. If the motor vehicle or vessel is towed, the owner is not liable for any damage to the motor vehicle or vessel once the tower takes possession."

Section 2. Sections 8-15-39 and 8-15-40 are added to the Code of Alabama 1975, to read as follows:

§8-15-39.

(a) An owner may impose a reasonable late fee on an occupant for each month the occupant does not pay rent when due. For purposes of this section, a reasonable late fee may be computed as the greater of twenty dollars ($20) per month or 20 percent of the amount of monthly rent. Any late fee imposed by an owner pursuant to this section is in addition to any other remedy provided by law or contract.

(b) An owner shall provide adequate notice to an occupant before a late fee is imposed. Adequate notice is provided if the late fee is identified in the rental agreement or a notice is sent to the occupant at his or her last known address that notifies the occupant that a late fee may be charged in any month in which the occupant does not pay rent when due.

§8-15-40.

An occupant who is a service member and who is transferred or deployed overseas on active duty for a period of 180 days or more may notify the owner of the transfer or deployment. The occupant shall provide written evidence of the transfer or deployment with the notice. If an owner receives a notice with supporting evidence from an occupant, the owner may not enforce his or her lien until 90 days after the end of the overseas service of the occupant.

Section 3. This act shall become effective on the first day of the third month following its passage and approval by the Governor, or its otherwise becoming law.

Self Service Storage Act

Storage

Business and Labor

Code Added

Code Amended