In late October, the Illinois Court of Appeals released its decision in Vartik Dubey vs. Public Storage Inc., another harsh verdict against the self-storage industry for wrongful sale of goods. I’m not personally involved in the case; the facts I cite are those delivered in the decision, and I don’t know if Public Storage plans to appeal to a higher court. As of November, the case had been remanded for review of a portion of punitive-damage award, so it’s not final. But the decision is worth noting.
Here’s a recap: Ms. Dubey rented a unit at a Public Storage facility in Illinois and, at the time, advised an employee that she had a large amount of goods: a washer, dryer, refrigerator, bikes, lawnmowers, televisions, jewelry, basketball hoop, etc. She picked the larger of the two units she was shown, and agreed to come back later to sign the rental agreement.
The manager prepared the rental agreement for unit C-10. Dubey signed it. Then the manager took Dubey to her unit and placed her lock on it. A day or so later, the tenant began to move in.
Unfortunately, the unit on which the manager placed the lock was E-11, not C-10. E-11 had been rented to someone else, who consequently failed to pay rent. Public Storage sold the contents of E-11―Dubey’s property. Dubey, by the way, had been on automatic payment via credit card and was not delinquent at the time her unit was sold.
When Dubey discovered she could no longer access her unit, the manager explained the unit had been sold to recoup the $191 past-due balance, and items of a personal nature that could not be sold (photos, for example) had been thrown out. The manager wouldn’t even tell Dubey where the garbage was so she could attempt to retrieve her items.
Assessing the Damage
Dubey claimed her goods were wrongfully sold and she was given no notice of the sale. She also claimed to have stored $150,000 worth of goods, even though the rental agreement she signed contained a provision limiting the value of personal property stored to $5,000. She further testified that the rental agreement was only explained to her for five minutes, the unit number on the agreement was not clearly disclosed, and she wasn’t informed of the value limit.
This case was tried partially by a jury and partially to the court. The verdict in Dubey’s favor was $5,000 for breach of contract and $5,000 for conversion. The jury also awarded punitive damages in the amount of $745,000 (this amount has been remanded for reconsideration). The trial court handling the Consumer Fraud Act claim awarded compensatory damages of $69,145, an additional punitive-damage award of $207,435, plus attorneys fees of $185,849, bringing the wrongful-sale verdict total to $1.217 million, upheld by the Court of Appeals.
There are two things you need to take from this case as it pertains to value limits. First, value limits in the rental agreement should be highlighted or bolded and pointed out if not explained to tenants. Also, make sure you include language in your agreement stating that higher value limitations may be available for consideration if requested. This is mandatory in New York and recommended in light of several cases on the subject.