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Legal Considerations of Storing Boats, RVs and Other Vehicles: A Self-Storage Operator's Guide for Avoiding Pitfalls

Jeffrey Greenberger Comments
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Accurate Information

Collecting accurate tenant information on your rental agreement gives you a better chance of locating the vehicle owner in the event of an emergency or default. This has never been more important, as more vehicles are now abandoned at self-storage facilities when the owners can’t make the payments.

If you have good lien and title information, the bank may take the vehicle back from you in the form of repossession and may even pay some storage charges. Otherwise, you become the “lien hunter.” It also gives you a better defense if a claim is brought against you for wrongful disposal or termination of contract. Consider requiring the following information with your lease: 

  • The year, color, make and model of the vehicle
  • The license-plate number and state
  • The VIN or other identification number
  • A copy of the vehicle registration

Just as with self-storage, don’t allow more than one person to sign the lease. In addition, require your lessee to be the actual owner of the vehicle. If the name on the registration is not the same as the person executing the rental agreement, your customer must have a statement notarized by the owner that clearly states it’s acceptable to store the vehicle at the facility. Make sure you have all of the owner’s relevant information. By doing this, you will avoid the possibility of storing a stolen vehicle. You can also steer clear of issues if ownership is ever disputed. 

All Potential Vehicles

As you gather information for the lease, get details on every vehicle that could potentially be stored in the space. For example, someone might store a trailer and two jet skis in a single space, which counts as three titled vehicles. Don’t forget to get information on each of them. 

Many tenants will pick up one vehicle at the storage facility, such as their RV, and leave the one they drove in at the space. This creates a problem if you haven’t previously approved and collected data on this other vehicle. All of a sudden, the RV is gone and an SUV is in its place. Does it belong to your tenant? Is it insured? Is it subject to the terms and conditions of the rental agreement, which sets things like value limitation, release of liability for damage, etc.?

If there’s a chance another vehicle is going to be left in the space for any length of time, it needs to be listed as an additional vehicle on your rental agreement. If it’s not, all the trouble you’ve gone through to protect yourself on the main vehicle could be for naught, especially if something happens when the different vehicle is stored by the same tenant in the same space.

Check your state’s self-storage statute. Some states have provisions to address simple things such as the superiority of your lien to a filed or recorded vehicle lien, and complex issues such as procedures that specify exactly how to obtain a title to a vehicle in default so you can sell it.

Don’t assume you can simply go down to your local title agency and obtain a lienholder’s title any time a vehicle is in default, and then sell the vehicle at your next lien sale. This is often not the case. Even if you can get a new title, if there is a lien on the vehicle, that lien almost always is superior to your storage lien. Thus, you may do all the title work and sell the vehicle and not be entitled to any of the sale proceeds.

Hazardous Materials

Vehicle storage presents a special problem because vehicles contain hazardous materials just waiting to spill, leak or explode on the property in the form of gasoline, lubricants, battery acid, tires, toilet chemicals, etc. This problem is exacerbated by the fact that vehicles are parked on soil, gravel or asphalt, which allows the chemical or spill to quickly enter the soil.

Given the volume of liquids and lubricants stored in a RV, for example, a leak or spill could create a serious environmental hazard on your property. Further, some tenants try to store extra gas, chemicals, tires, etc., in or around their property. Fortunately, there’s reasonably priced hazardous-cleanup insurance coverage, but you have to buy it separately.

Include limiting language in your rental agreement specifically targeted to the outdoor storage of vehicles, outlining how much liquid (i.e., gas) may be stored and preventing additional liquid storage. Make sure your insurance company is aware of this type of storage at your property. Also, check with your mortgage holder to ensure the vehicle doesn’t violate a term or condition of your loan.

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