The North Carolina General Assembly has passed parallel bills (House Bill 243; Senate Bill 263) that amend the state’s self-storage lien law. Updates to the law will enable self-storage operators to use e-mail when notifying defaulted tenants of impending lien procedures, impose new late fees, place public advertisements of a lien auction in media other than a local newspaper, and use online-auction websites to conduct a lien sale.
The North Carolina Self Storage Association and national Self Storage Association have been working with lawmakers since March to amend the existing lien law. The amended bill passed the House 92-10 last week and awaits Gov. Pat McCrory’s signature. If the governor signs the bill, it will go into effect Oct. 1.
Under the new lien law, tenant notifications can be sent by Certified mail or verified e-mail as long as the tenant agrees to accept e-mails via a signed rental agreement. Verified e-mails will be considered delivered once transmitted.
Currently, self-storage operators in North Carolina must publish auction notices at least five days prior to a sale in a newspaper of general circulation in the county where the auction will be held. The amended law removes the stipulation of using a newspaper or another publication with classified ads to advertise the auction. An auction will be deemed “commercially reasonable” as long as “at least three independent bidders attend the sale at the time and place advertised,” according to the law’s new language. The update would also allow lien sales to be held on an online-auction website.
Other changes to the bill include the ability to assess late fees of $15 or 15 percent, whichever is greater, after five days delinquency. In addition, new language adds boats and RVs to the motor-vehicle lien clause, which will enable operators to have watercraft and trailers towed after delinquency exceeds 60 days.