Senator Kirk A. Cullimore proposes the following substitute bill:


1     
SELF-SERVICE STORAGE AMENDMENTS

2     
2024 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kirk A. Cullimore

5     
House Sponsor: James A. Dunnigan

6     

7     LONG TITLE
8     General Description:
9          This bill modifies requirements for self-service storage facilities.
10     Highlighted Provisions:
11          This bill:
12          ▸     adds additional requirements for the written notice to the occupant before the
13     disposal of personal property; and
14          ▸     enacts standards for the renewal of a rental agreement with a self-service storage
15     facility.
16     Money Appropriated in this Bill:
17          None
18     Other Special Clauses:
19          None
20     Utah Code Sections Affected:
21     AMENDS:
22          38-8-2, as last amended by Laws of Utah 2013, Chapter 163
23          38-8-3, as last amended by Laws of Utah 2021, Chapter 355
24     ENACTS:
25          38-8-6, Utah Code Annotated 1953
26     

27     Be it enacted by the Legislature of the state of Utah:
28          Section 1. Section 38-8-2 is amended to read:
29          38-8-2. Lien against stored property -- Attachment and duration -- Search for
30     financing statement prerequisite to enforcement of lien.
31          (1) When an owner and an occupant enter into a rental agreement, the owner and the
32     owner's heirs, executors, administrators, successors, and assigns have a lien upon all personal
33     property located at the self-service storage facility for rent, labor, or other charges, present or
34     future, in relation to the personal property and for expenses necessary for its preservation or
35     expenses reasonably incurred in its sale under this chapter.
36          (2) The lien described in Subsection (1) attaches on the date the personal property is
37     brought to the self-service storage facility and continues so long as the owner retains
38     possession and until any default is corrected or a sale pursuant to a default is conducted to
39     satisfy the lien.
40          (3) (a) A rental agreement shall state that:
41          [(a)] (i) an owner is entitled to sell, donate, or dispose of all personal property stored at
42     the self-service storage facility pursuant to the rental agreement if the occupant is in default for
43     a continuous 30-day period; and
44          [(b)] (ii) the occupant shall disclose to the owner any lienholders that have an interest
45     in the property that will be stored at the self-service storage facility.
46          (b) (i) An owner may impose and collect a reasonable late fee for each period described
47     in the rental agreement that an occupant does not timely pay rent, fees, or other charges due
48     under the rental agreement if the fee and the conditions for imposing the fee are stated in the
49     rental agreement.
50          (ii) A late fee of the greater of $20 or 20% of the monthly rent, for each period
51     described in the rental agreement, is a reasonable fee and is not considered a penalty.
52          (4) If a rental agreement states a maximum, aggregate value of the personal property
53     that may be stored at the occupant's storage space, the occupant may not assert that the value of
54     the personal property actually stored at the occupant's storage space exceeds the maximum
55     amount stated in the rental agreement.
56          (5) (a) Before an owner takes enforcement action under Section 38-8-3, the owner shall
57     determine if a financing statement filed in accordance with Title 70A, Chapter 9a, Part 5,
58     Filing, has been filed with the Division of Corporations and Commercial Code concerning the
59     property to be sold.
60          (b) A security interest evidenced by a financing statement filed in accordance with
61     Title 70A, Chapter 9a, Part 5, Filing, has priority over the lien provided by this section.
62          Section 2. Section 38-8-3 is amended to read:
63          38-8-3. Enforcement of lien -- Notice requirements -- Sale procedure and effect.
64          (1) An owner may enforce a lien described in Section 38-8-2 against an occupant [if:]
65     and sell, donate, or dispose of stored property under Subsection 38-8-3, without liability if:
66          (a) the occupant is in default for a continuous 30-day period; and
67          (b) the owner provides written notice of the owner's intent to enforce the lien, in
68     accordance with the requirements of this section, to:
69          (i) the occupant;
70          (ii) each lienholder disclosed by the occupant under Subsection 38-8-2(3)(b);
71          (iii) each person that has filed a valid financing statement with the Division of
72     Corporations and Commercial Code; and
73          (iv) each person identified as a lienholder in the records of the Motor Vehicle Division.
74          (2) The owner may sell, donate, or dispose of any property remaining at the self-service
75     storage facility at the end of a rental agreement without liability if:
76          (a) the owner has provided written notice to the occupant by first-class mail to the
77     occupant's last known address or by email to the occupant's last known email address;
78          (b) the written notice states that the owner will sell, donate, or dispose of the property
79     following a specified date at least 15 days after the date of the notice, unless the occupant
80     removes the property before the specified date; and
81          (c) any proceeds remaining after the owner deducts rent, labor or other charges, and
82     expenses reasonably incurred in the sale or disposal of the personal property are delivered to
83     the Utah state treasurer as unclaimed property.
84          [(2)] (3) An owner shall provide the written notice described in Subsection (1)(b):
85          (a) in person;
86          (b) by certified mail, to the person's last known address; or
87          (c) subject to Subsection [(3)] (4), by email, to the person's last know email address.
88          [(3)] (4) If an owner sends a notice described in Subsection [(2)] (3) by email and does
89     not receive a response, return receipt, or delivery confirmation from the email address to which
90     the notice was sent within three business days after the day on which the notice was sent, the
91     owner shall deliver the notice in person or by certified mail to the person's last known address.
92          [(4)] (5) A written notice described in Subsection (1)(b) shall include:
93          (a) an itemized statement of the owner's claim showing the sum due at the time of the
94     notice and the date when the sum became due;
95          (b) a brief description of the personal property subject to the lien that permits the
96     person to identify the property, unless the property is locked, fastened, sealed, tied, or
97     otherwise stored in a manner that prevents immediate identification of the property;
98          (c) if permitted by the terms of the rental agreement, a notice that the occupant may not
99     access the occupant's personal property until the occupant complies with the requirements
100     described in Subsection [(9)] (10);
101          (d) the name, street address, and telephone number of the owner or the individual the
102     occupant may contact to respond to the notification;
103          (e) a demand for payment within a specified time not less than 15 days after the day on
104     which the notice is delivered; and
105          (f) a conspicuous statement that, unless the claim is paid within the time stated in the
106     notice, the owner will:
107          (i) sell, donate, or dispose of the personal property; or
108          (ii) [will be advertised for sale and will] advertise the personal property to be sold at a
109     specified time and place.
110          [(5)] (6) A notice under this section shall be presumed delivered when it is deposited
111     with the United States Postal Service and properly addressed with postage prepaid.
112          [(6)] (7) (a) (i) After the expiration of the time given in the notice, the owner shall
113     publish an advertisement of the sale of the personal property subject to the lien once in a
114     newspaper of general circulation in the county where the self-service storage facility is located.
115          (ii) An advertisement described in Subsection [(6)(a)(i)] (7)(a)(i) shall include:
116          (A) the address of the self-service storage facility and the number, if any, of the space
117     where the personal property is located;
118          (B) the name of the occupant; and
119          (C) the time, place, and manner of the sale, which shall take place not sooner than 15
120     days after the day on which the sale is advertised under Subsection [(6)(a)(i)] (7)(a)(i) .
121          (b) Subsection [(6)(a)] (7)(a) does not apply if:
122          (i) the owner:
123          (A) provided the notice described in Subsection (1)(b) by email; and
124          (B) received a response or return receipt from the email address to which the notice
125     was sent; or
126          (ii) the owner:
127          (A) provided the notice described in Subsection (1)(b) by certified mail; and
128          (B) has evidence of providing the notice by certified mail.
129          [(7)] (8) A sale of the personal property shall conform to the terms of the notice
130     provided for in this section.
131          [(8)] (9) A sale of the personal property shall be held at the self-service storage facility,
132     at the nearest suitable place to where the personal property is held or stored, or online.
133          [(9)] (10) Before a sale of personal property under this section, the occupant may pay
134     the amount necessary to satisfy the lien and the reasonable expenses incurred under this section
135     and thereby redeem the personal property; upon receipt of this payment, the owner shall return
136     the personal property, and thereafter the owner shall have no liability to any person with respect
137     to that personal property.
138          [(10)] (11) A purchaser in good faith of the personal property sold to satisfy a lien as
139     provided for in this chapter takes the property free of any rights of persons against whom the
140     lien was valid and free of any rights of a secured creditor, despite noncompliance by the owner
141     with the requirements of this section.
142          [(11)] (12) In the event of a sale under this section, the owner may satisfy the lien for
143     the proceeds of the sale, subject to the rights of any prior lienholder; the lien rights of the prior
144     lienholder are automatically transferred to the proceeds of the sale; if the sale is made in good
145     faith and is conducted in a reasonable manner, the owner shall not be subject to any surcharge
146     for a deficiency in the amount of a prior secured lien, but shall hold the balance, if any, for
147     delivery to the occupant, lienholder, or other person in interest; if the occupant, lienholder, or
148     other person in interest does not claim the balance of the proceeds within one year of the date
149     of sale, it shall become the property of the Utah state treasurer as unclaimed property with no
150     further claim against the owner.
151          [(12)] (13) If the requirements of this chapter are not satisfied, if the sale of the
152     personal property is not in conformity with the notice of sale, or if there is a willful violation of
153     this chapter, nothing in this section affects the rights and liabilities of the owner, occupant, or
154     any other person.
155          Section 3. Section 38-8-6 is enacted to read:
156          38-8-6. Renewal.
157          (1) An owner may modify the terms of a rental agreement upon giving notice in writing
158     to the occupant:
159          (a) by first-class mail to the occupant's last known address; or
160          (b) by email to the occupant's last known email address.
161          (2) An owner shall send written notice to modify the terms of the rental agreement at
162     least 30 days before the day on which the modified terms take effect.
163          (3) The occupant is bound by the terms of the modified rental agreement if the
164     occupant continues to store personal property at the self-service storage facility beginning on
165     the date the modified rental agreement takes effect if the owner complies with Subsection
166     (1)(a) or (b).
167          Section 4. Effective date.
168          This bill takes effect on May 1, 2024.