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H.B. 237





Chief Sponsor: Julie Fisher

Senate Sponsor: J. Stuart Adams

             7      LONG TITLE
             8      General Description:
             9          This bill modifies a provision relating to the enforcement of storage facility liens.
             10      Highlighted Provisions:
             11          This bill:
             12          .    requires a notice of a lien enforcement action involving the sale of a motor vehicle,
             13      vessel, or outboard motor to be sent to the last known address of the registered
             14      owner, as disclosed by the records of the Motor Vehicle Division.
             15      Money Appropriated in this Bill:
             16          None
             17      Other Special Clauses:
             18          None
             19      Utah Code Sections Affected:
             20      AMENDS:
             21          38-8-3, as last amended by Laws of Utah 2009, First Special Session, Chapter 5
             23      Be it enacted by the Legislature of the state of Utah:
             24          Section 1. Section 38-8-3 is amended to read:
             25           38-8-3. Enforcement of lien -- Notice requirements -- Sale procedure and effect.
             26          A claim of an owner which has become due against an occupant and which is secured
             27      by the owner's lien may be satisfied as follows:

             28          (1) No enforcement action may be taken by the owner until the occupant has been in
             29      default continuously for a period of 30 days.
             30          (2) After the occupant has been in default continuously for a period of 30 days, the
             31      owner may begin enforcement action if the occupant has been given notice in writing. The
             32      notice shall be delivered in person or sent by certified mail to the last known address of the
             33      occupant[, and a]. If the property to be sold in an enforcement action includes a motor vehicle,
             34      vessel, or outboard motor, the notice shall also be delivered to the last known address of the
             35      registered owner, as disclosed by the records of the Motor Vehicle Division. A copy of the
             36      notice shall, at the same time, be sent to the sheriff of the county where the self-service storage
             37      facility is located. Any lienholder with an interest in the property to be sold or otherwise
             38      disposed of, of whom the owner has knowledge either through the disclosure provision on the
             39      rental agreement or through the existence of a validly filed and perfected UCC-1 financing
             40      statement with the Division of Corporations and Commercial Code, or through other written
             41      notification, shall be included in the notice process as set forth in this section.
             42          (3) This notice shall include:
             43          (a) an itemized statement of the owner's claim showing the sum due at the time of the
             44      notice and the date when the sum became due;
             45          (b) a brief and general description of the personal property subject to the lien, which
             46      description shall be reasonably adequate to permit the person notified to identify the property;
             47      except that any container including, but not limited to, a trunk, valise, or box that is locked,
             48      fastened, sealed, or tied in a manner which deters immediate access to its contents may be
             49      described as such without describing its contents;
             50          (c) a notification of denial of access to the personal property, if such denial is permitted
             51      under the terms of the rental agreement, which notification shall provide the name, street
             52      address, and telephone number of the owner or his designated agent whom the occupant may
             53      contact to respond to the notification;
             54          (d) a demand for payment within a specified time not less than 15 days after delivery of
             55      the notice; and
             56          (e) a conspicuous statement that, unless the claim is paid within the time stated in the
             57      notice, the personal property will be advertised for sale or other disposition and will be sold or
             58      otherwise disposed of at a specified time and place.

             59          (4) Any notice made under this section shall be presumed delivered when it is
             60      deposited with the United States postal service and properly addressed with postage prepaid.
             61          (5) (a) After the expiration of the time given in the notice, an advertisement of the sale
             62      or other disposition shall be published:
             63          (i) (A) if there is a newspaper of general circulation in the county where the
             64      self-service storage facility is located, once a week for two consecutive weeks in a newspaper
             65      of general circulation in that county; or
             66          (B) if there is not a newspaper of general circulation in the county where the
             67      self-service storage facility is located, by posting the advertisement of sale or other disposition
             68      in not less than six conspicuous places in the neighborhood where the self-service storage
             69      facility is located; and
             70          (ii) in accordance with Section 45-1-101 for two weeks.
             71          (b) The advertisement described in Subsection (5)(a) shall include:
             72          (i) a brief and general description of the personal property reasonably adequate to
             73      permit its identification as provided for in Subsection (3)(b); the address of the self-service
             74      storage facility and the number, if any, of the space where the personal property is located; and
             75      the name of the occupant and his last known address; and
             76          (ii) the time, place, and manner of the sale or other disposition, which sale or other
             77      disposition shall take place not sooner than 15 days after the first publication.
             78          (6) Any sale or other disposition of the personal property shall conform to the terms of
             79      the notice provided for in this section.
             80          (7) Any sale or other disposition of the personal property shall be held at the
             81      self-service storage facility or at the nearest suitable place to where the personal property is
             82      held or stored.
             83          (8) Before any sale or other disposition of personal property under this section, the
             84      occupant may pay the amount necessary to satisfy the lien and the reasonable expenses incurred
             85      under this section and thereby redeem the personal property; upon receipt of this payment, the
             86      owner shall return the personal property, and thereafter the owner shall have no liability to any
             87      person with respect to that personal property.
             88          (9) A purchaser in good faith of the personal property sold to satisfy a lien as provided
             89      for in this chapter takes the property free of any rights of persons against whom the lien was

             90      valid and free of any rights of a secured creditor, despite noncompliance by the owner with the
             91      requirements of this section.
             92          (10) In the event of a sale under this section, the owner may satisfy his lien for the
             93      proceeds of the sale, subject to the rights of any prior lienholder; the lien rights of the prior
             94      lienholder are automatically transferred to the proceeds of the sale; if the sale is made in good
             95      faith and is conducted in a reasonable manner, the owner shall not be subject to any surcharge
             96      for a deficiency in the amount of a prior secured lien, but shall hold the balance, if any, for
             97      delivery to the occupant, lienholder, or other person in interest; if the occupant, lienholder, or
             98      other person in interest does not claim the balance of the proceeds within one year of the date
             99      of sale, it shall become the property of the Utah state treasurer as unclaimed property with no
             100      further claim against the owner.
             101          (11) If the requirements of this chapter are not satisfied, if the sale of the personal
             102      property is not in conformity with the notice of sale, or if there is a willful violation of this
             103      chapter, nothing in this section affects the rights and liabilities of the owner, occupant, or any
             104      other person.

Legislative Review Note
    as of 1-17-11 10:05 AM

Office of Legislative Research and General Counsel

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