September 1, 2007

8 Min Read
Legal Perspectives

Recently, an area manager in Minnesota inquired about protocol for a tenants change of address. A renters property was sold because of non-payment, but he claimed he hadnt received the notices required by statute. According to the tenant, he had sent a change of address via e-mail to the facility. But the lease requirement stated a change of address had to be signed.

The occupant alleged that, because of recent court cases, e-mail constitutes a digital signature, and the facility should have accepted it in lieu of a hand-signed document. The facility denied receiving the e-mail and further claimed it would have been declined because of the rental agreement. The question from this manager, surprisingly, related to whether it is bad customer service to refuse a change of address by e-mail.

Tenants on the Move

Notice from a tenant of a change of address is common in this industry. Customers often rent self-storage units because they are between addresses for any number of reasons. This makes receiving and acknowledging a change of address one of the most critical operations you may have at your facility. Lets discuss the sure things first.

Most self-storage statutes make reference in the definition section and the lien-sale section to a last known address. Some statutes, such as those for Michigan and Florida, state that notification of an address change must be made by hand delivery or first-class mail. Several other states, such as California, direct you to request a secondary address to send notices, although I dont know of a state that requires it. Regardless, a change of address must be treated with reverence, and the process of obtaining one should be highly controlled.

The best way to control a change-of-address request is to have a rental-agreement clause that sets forth how and when it may be given to the operator. Without the clause, youll be left open to claims of faxes, e-mails and who knows what else.

For everyones security and best interest, particularly in states where there is doubt about a change-of-address procedure, draft your lease to require that address changes be given via Certified Mail or in person at the office. I suggest managers explain this concept to tenants in great detail. In particular, make it clear that a changed check address or a return address on a check-payment envelope might be missed, and so its critical to notify the facility by the correct procedure.

Perhaps consider providing a change-of-address form or card in a folder with the initial lease documents given to your tenant at move-in. You might explain, Here is a folder with a copy of your lease, a copy of the rules and regulations for the facility, a referral card for a friend, and a form to change your address. Its so important that we be able to contact you at all times that we have created a separate form.

Many operators also leave change-of-address forms in a box outside the office, so tenants can drop them into the night-deposit or payment slot (though this is certainly not as secure and may attract pranks). Still, its best to get the change notice in person than by e-mail or phone and, hopefully, your CCTV will document tenants as they submit signed forms in the drop slot. Ive even heard some managers leave a form taped inside units to provide constant reminders to renters.

All of these ideas generally work. In sum, tenants want the easiest way possible to change their addresses, and sending a certified letter to the office is sometimes considered a chore. If you do accept e-mails, faxes, phone calls and changes on the outside of payment envelopes, etc., you may very well miss information. Your employees may overlook an address change, or an e-mail may be blocked by a spam filter or even lost in cyberspace. It happens.

Considering Murphys Law, it will be the person who allegedly changes an address by e-mail or fax or phone who goes delinquent; and hell be the one who declined to provide a secondary contact address and whose cell phone has been disconnected. After his goods are sold, youll be left wondering if hes going to come out of the woodwork years later and claim you failed to send him the necessary notices.

Technicalities

Let me address a thought that is probably going through your mind right now. Many state statutes say the service of the default notice is presumed delivered X number of days after depositing it postage pre-paid in the U.S. mail. I caution you about this for two reasons:

1. The requirements of statutes are technical. You may have to obtain a certificate of mailing from a post office or, if Certified Mail is required with return receipt, the only valid method is through a post-office-stamped envelope. While you may think you are in the clear, it would be unfortunate to discover you did not actually follow the statute as required. Also, can you presume delivery of mail that is returned to you?

2. Judges reserve the right to not agree with you on presumption of service if the tenant can give evidence that change of address was provided, indicating you allegedly ignored it. In the earlier example from the manager in Minnesota, the customer claims the facility must have deleted the e-mail, but he cant reprint the original message. Regardless of whether you have a presumption of delivery in your state, this type of situation exposes you to unnecessary risk.

The biggest problem with e-mails and faxes is they can be faked. Its easy to create a forwarded e-mail to resemble an original. Further, tenants can mistype the facilitys e-mail address or the message can be blocked by your spam filter. Ive learned from several technologically savvy people that an ISP can trace receipt of an e-mail, but no one could tell me for how long. The millions of e-mails sent every day make it time- and cost-prohibitive to determine whether you actually received an e-mail from a tenant.

Even a traced e-mail doesnt prove change of address was included. While the customer can say he e-mailed you, he could have sent anything and later claim it was an address change. Hence, accepting a change of address by e-mail or fax is risky and exposes you to unnecessary liability.

Best Methods

First, include a rental-agreement clause requiring notice of a change of address in person or by Certified Mail. That is still the best way to ensure everyone knows a change has been made, and the tenant has a real receipt to prove it.

If you have a kiosk that has fingerprint recognition and a camera, any change made at the kiosk could be acceptable because a digital record would be maintained. Compare this, by contrast, to an e-mail you may allegedly receive from a tenant but is actually from a disgruntled boyfriend/girlfriend/ spouse. How are you going to know for sure the e-mail you received is actually from your customer?

If you still decide to accept notice by computer, refuse e-mail and instead set up a dedicated, secure website where tenants can use their names and individually created passwords to log in, provide a change of address and receive a confirmation number for their records. (Hopefully, the password is known only to the occupant.) This is the type of digital signature so many courts recognize as valid and binding.

Another thought: Add to your voicemail greeting a statement that tenants cant leave a valid change of address on the system. In the insurance and financial industries, you cannot change or bind coverage via phone, or buy or sell stock with a phone message. Insurance agencies and stock brokerages still survive despite being so consumer unfriendly.

Finally, if you decide to accept address changes via phone, take a page from the banking industry. If someone provides a bank or credit card company with a change of address or other activity on the account, a notice is sent to the new and old address advising the customer of the account change. Consider sending receipt of address changes to tenants; if the new address is returned to you undeliverable, unclaimed, etc., then youll know somethings amiss.

Explain to tenants that, for their protection and the protection of their goods, there are strict rules, like those within other professional industries. An account change requires a document in person or sent in a secure manner like Certified Mail or by secure website, signed by the occupant. To emphasize this point, you might say, You wouldnt want me to change any significant terms and conditions of your rental agreement (like increasing fees) without getting a signed document from the facility manager. I hope you understand why we would want the same. 

Jeffrey Greenberger practices with the law firm of Katz, Greenberger & Norton LLP in Cincinnati. He primarily represents owners and operators of commercial real estate, including self-storage. This column is for the purpose of providing general legal insight into the self-storage field and should not be substituted for the advice of your own attorney. Mr. Greenberger is the legal counsel for the Ohio Self Storage Owners Society and the Kentucky Self Storage Association. His new website, www.selfstoragelegal.com, contains his legal opinions and insights into the self-storage industry, as well as an article archive. For more information, call 513.721.5151; e-mail [email protected]

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