The very first in the series of Auctioneer Lien Law Webinar Series, Lien Law 101 from a nationwide perspective. We will look at the various steps self storage operators face in lien enforcement when a tenant does not pay. This topic is going to be presented again in August. Look for the invite!

1. 11/29/2018
1
LIEN LAW 101
Cheli Rosa
Strategic Account Manager, Auctioneer
StorageTreasures, Managed by OpenTech Alliance
WINNINGTHE BATTLE BEGINS WITH GOOD
CUSTOMER SERVICE
YOUR RENTAL AGREEMENT
 Many states have specific language
required for your rental agreement.
 Many require a statement similar to
“the property stored in the leased
space may be sold or otherwise
disposed of if the occupant is in
default.”
 The agreement must be in writing.
LIEN LAW DEFINITIONS
• DEFAULT – Many states specify a tenant goes into “default” when the obligations set
forth in the rental agreement are not met. BUT –That does not mean you can take
immediate action.
• Be on alert for additional date restrictions…
• Number of days the tenant must be past due before you can overlock a unit.
• 2013 EXR Class Action Lawsuit
• Number of days the tenant must be past due before you can begin the lien
enforcement process.
• Number of total days the tenant must be past due before you can legally sell the unit.
LAST KNOWN ADDRESS
• A legal address can mean different things in
different states.
• Street address, PO Box, or email address
• A legal change of address can also be provided in
different ways depending on the state.
• In person
• Certified mail
• Via email
• INWRITING
EMAIL
• EMAIL – usually something similar to “an electronic
message that is transmitted between two or more
telecommunications devices, computers, or electronic
devices. Electronic mail includes electronic messages
transmitted through a local, regional, or global
computer network.
• Things to keep in mind
• Many states do not define or mention the use of
email.
• Your tenant needs to provide their email address in
the rental agreement.
• Any emails sent regarding lien enforcement will
need to be tracked to prove they were read.

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YOUR LIEN
• You have a lien on the property stored at your facility for
the sole purpose of recovering a debt owed to you.
• You do not own the property.You cannot do whatever
you want with it.You must enforce your lien through the
guidelines in your state statute.
• Your lien will likely either attach the date the tenant
moves into the facility or the date they become default.
• Most statutes will say your lien is superior to any liens
arising after yours, but not any in place prior to your
tenant renting a unit.
PERFECTED SECURITY INTERESTS ANDTAX LIENS
• Except for very rare circumstances, your lien
will not always be the most important lien on a
tenant’s property.
• Find out if your statute references a “perfected
security interest.” If it does, it is possible
someone else has a right to the debt recovery
before you.
• Rent-to-Own establishments
• State Department of Revenue
• Mechanics
• Internal Revenue Service
LIEN SEARCHES AND UCC SEARCHES
You can find out if a “perfect
security interest” has previously
been filed against your tenant by
conducting aUCC search.
LIEN SEARCHES
DO I REALLY NEEDTO DOTHIS?
If you have any statement
similar to the example shown
here, you absolutely have to
research liens perfected before
yours.
LIEN ENFORCEMENT
1.Deny access to the unit
2.Send lien notices or notice of sale
3.Run advertisements
4.Conduct a sale
5.Perform “after sale functions”

3. 11/29/2018
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LIEN LETTER
Your lien law may require
certified mail or verified mail Your lien law will likely require
an itemized statement of the
amount due as well as any
charges which might accrue
before the sale
Most statutes require you to
include a brief description of
the property
Several states require you to
include a “Demand for
Payment” date
Your letter must
indicate the time and
date of the saleYou need to include the address
and phone number where the
tenant can reach you to pay their
bill
LIEN LETTER
Your lien law require certified
mail or verified mail Your lien law will likely require
an itemized statement of the
amount due as well as any
charges which might accrue
before the sale
Most statutes require you to
include a brief description of
the property
Several states require you to
include a “Demand for
Payment” date
Your letter must
indicate the time and
date of the saleYou need to include the address
and phone number where the
tenant can reach you to pay their
bill
WAITTIME BETWEENACTIONS
Most states require you to wait a certain
amount of time between sending your
letter and running your first
advertisement.
• The wait time could be anywhere
from 7-30+ days.
• Your waiting period begins AFTER
you have sent your lien letter.
ADVERTISEMENT
• The lien law might require you run your ad in a “Newspaper
of General Circulation” or on a website.
• You may or may not be required to include the tenant’s
name and unit number.
• The description of property will likely be required and should
usually match the description given in the lien letter.
• The ad will need to include the statement the items are
“being sold at a public sale.”
• The ad will need to contain the date, time, and location of
the sale.
• If you use online auctions, you will likely also need to include
the physical address of the facility in the ad as well.
WAITING,WAITING, WAITING
• Your state lien law is likely to set a certain amount of
time you must wait between running your first ad and
conducting your lien sale.
• This time frame will begin AFTER the date your first ad
runs.
• Be sure you wait enough time before the lien notice and
the first ad.
SECOND AD & CONSECUTIVE WEEKS
• If a second ad is required in your state, it is generally expected to run in
consecutive weeks.
• A second ad typically does not have any influence on the timeline of
your lien enforcement.

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CONDUCTINGYOUR SALE
After the
appropriate amount
of time has passed
after your first ad,
you can have your
sale in the manner
you choose.
COMMERCIAL REASONABILITY
• Did you have enough independent
bidders attend your sale?
• Did you recover an appropriate
amount to f money from the sale?
• Can you dispose of items which
are clearly worthless?
AFTERTHE SALE
• You might be legally required to send a Notice of Sale letter to your tenant.
• You will be required to send a Demand and Release letter if the unit sells for more than what is
owed.
• The tenant is entitled to reclaim any income over the debt owed.
• You are usually required to turn over any unclaimed proceeds to the relevant state agency.
• Most state lien laws require a buyer take all property free and clear of any liens.
COMMON LIEN ENFORCEMENT
ISSUES
ACTIVE MILITARYTENANTS
You cannot sell personal property
belonging to a member of the
active military or their spouse until
they have been removed from
active duty for 90 days.
Why? Servicemembers Civil Relief
Act (SCRA)
https://www.justice.gov/sites/defaul
t/files/crt/legacy/2011/03/23/scratext
.pdf
ACTIVE MILITARY SEARCHES
How do you know if your tenant is on active duty military
status?
1. Ask them! Ask this question on your rental agreement or
customer information sheet.
2. FREE SEARCH -
https://www.dmdc.osd.mil/appj/scra/single_record.xhtml
3. PAID Search -
https://www.servicememberscivilreliefact.com

5. 11/29/2018
5
TENANTS IN BANKRUPTCY
•Automatic Stay - If your tenant notifies you that they have
filed bankruptcy, you must cease all collections efforts. This
includes: late calls, late notices, late emails, late text
messages, late social media messages.
• Find out who the bankruptcy trustee (attorney) is and
contact them regarding the status of the case.They might sign
an abandonment at which time you would be able to sell the
contents.
PACER– Public Access to Court Electronic Records
https://www.pacer.gov/
COLLECTION EFFORTS DURING
BANKRUPTCY
• All collection actions during a bankruptcy stay must halt.
However, can I deny access to the unit?
• The answer to this question depends on several factors,
including.
• Was the unit over locked prior to the bankruptcy being
filed?
• What chapter bankruptcy was filed?
• Has the tenant been making payments since the
bankruptcy was filed?
• If you find yourself in a situation in which the timing of
the bankruptcy filing and your collection actions are in
question, it is best to consult an attorney about the
best way to proceed.
DECEASEDTENANTS
• Confirm any information you are getting
regarding your tenant is accurate.Ask for
documentation.
• Request a certified copy of the death certificate.
• Request a copy of the death certificate.
• Request a picture ID of the executor or
administrator of the account.
• Confirm the identity of the executor with the
probate court.
THINGSYOU SHOULD DO IFYOUR TENANT IS
DECEASED
DECLARATION OF OPPOSITION
• Does your state allow for a Declaration of Opposition? Are you
certain you know the timelines and deadlines regarding the
Declaration of Opposition in your state?
• Do not assume people are not aware of this option. Lien laws
are posted all over the internet for anyone to find.
EDUCATE YOURSELF
Self Storage Association - https://www.selfstorage.org
Lookup your state self storage association
CHARITY STORAGE

6. 11/29/2018
6
JOIN OUR FIRST AUCTION REVIEW SERVICE
TEST GROUP
Beginning January 1, 2019
East Region
Steve Santee
(602) 324-8661
ssantee@opentechallaince.com
Central Region
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(602) 324-8655
jbecerra@opentechallaince.com
West Region
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(602) 324-8690
grupisan@opentechallaince.com
QUESTIONS
Cheli Rosa
StrategicAccount Manager,Auctioneer
crosa@opentechalliance.com
Direct: (404)643-4528
December Webinar in the new
Auctioneer Series:
Selling Motor Vehicles at Auction
Look for your invitation coming
soon!