What Would You Do? Common Self-Storage Legal Conundrums

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The following is part of an exciting 2013 content series titled "What Would You Do?" ISS asked managers and owners how they would react in difficult situations that can arise at any facility. We then asked experts to advise on their recommended course of action. To see all articles and slideshows in the series, enter code WWYD13 in the search box at insideselfstorage.com. The complete sequence will roll out over several weeks and be available in full by March 10, 2013.

Legal quandaries are among the biggest headache producers for owners and managers of self-storage facilities. Some operators simply aren't familiar with industry and state legislation; others don't understand it. Even when they are and do, the laws can change, and you can't always predict how they'll be interpreted by customers, judges and juries.

When it comes to legal issues, you can't put your head in the sand. They affect you daily, from the rental agreement you provide to customers, to the procedures you follow for unpaid rent, to other sticky scenarios such as tenant bankruptcy, tenant divorce, law-enforcement inquiries and others.

Do you know what to do in the face of legal risk? Is what you would do the same as what you should do?

Inside Self-Storage recently reached out to in-the-field operators to learn how they would proceed in specific but common situations that could happen any time at any facility. They were asked, "What would you do if ..."

  • You found illegal, inappropriate or personally identifiable items in an abandoned or unpaid unit?
  • A tenant altered the rental agreement before signing?
  • Your state updated its lien laws?

The answers were provided by members of Self-Storage Talk (SST), the industry's largest online community. We then asked two of the industry's top attorneys to tell us what operators should do in each case. Our well-known experts are Jeffrey Greenberger, a partner in the Cincinnati-based law firm of Katz, Greenberger & Norton LLP, and Scott Zucker a partner in the Atlanta-based law firm Weissmann Zucker Euster Morochnik, P.C.

What would you do if you found illegal, inappropriate or personally identifiable items in an abandoned or unpaid unit?

SST senior member geraldine1051 (who wishes to remain anonymous) says she would simply call her attorney, but Richard and Beverly Haessler (RichardandBeverly), resident managers of Park Inn Storage in Odessa, Texas, indicate it would depend on the items. For example, if the goods were illegal, they would call the police; but in the case of gas or propane, they would simply dispose of it. When discovering personally identifiable items like documents and records, they would try to reach the owner of the goods.

What SHOULD you do?

Greenberger: Any illegal goods found in the unit must be reported to the police. What constitutes "illegal" can depend on your state but generally includes drugs, drug-manufacturing supplies or equipment, explosives and other caustic chemical agents, child pornography, stolen property, and any evidence of foul play including bodies or body parts. In most states, it will include guns.

Because you could be interfering with a criminal investigation, never dispose of, remove or even touch any property that appears to be illegal until the proper authorities have seen it and given you clearance to proceed. If it turns out not to be illegal, it should be properly sold (if saleable), or disposed of via shredding or some other method.

Personally identifiable items are a different issue. If there is one thing legislators and citizens alike resent about self-storage, it's that personal information can inadvertently end up in the wrong hands. Several states, such as Arizona, Maine and Rhode Island, have addressed the problem by making sure such information is offered to the proper governmental agency for seizure or properly discarded/destroyed. The simple answer is, anything that appears to contain personal information, whether about the tenant or someone else, should be properly disposed of by the facility operator and should never end up in the dumpster or sold.

Also, no property from an abandoned unit or sale should ever end up in the possession of facility owners or employees. A wrongful-sale or disposal lawsuit is possible with any former tenant at any time, and the last allegation a defense attorney wants to face is that some or all of the property ended up in the hands of facility staff. It adds a whole new layer of trouble to an already crummy situation, especially if the property turns out to be illegal or inappropriate. The best course of action is to properly sell or dispose of all items as quickly as possible.

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