SB-0204, As Passed Senate, December 3, 2009

SUBSTITUTE FOR

SENATE BILL NO. 204

     A bill to amend 1985 PA 148, entitled

"Self-service storage facility act,"

by amending sections 2, 3, 4, and 5 (MCL 570.522, 570.523, 570.524,

and 570.525), as amended by 2000 PA 443.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 2. As used in this act:

     (a) "Active duty" means active duty pursuant to an executive

order of the president of the United States, an act of congress, or

an order of the governor.

     (b) "Armed forces" means that term as defined in section 2 of

the veteran right to employment services act, 1994 PA 39, MCL

35.1092.

(c) (a) "Last known address" means the street address, post

office box, or electronic mail address provided by the tenant in

the latest rental agreement or in a subsequent written notice of

change of address by hand delivery, or first-class mail, or

electronic mail.

     (b) "Rental agreement" means an agreement or lease that

establishes or modifies terms, conditions, rules, or any other

provision concerning the use and occupancy of a self-service

storage facility or use of a self-container storage unit.

     (d) "Michigan national guard" means that term as defined in

section 105 of the Michigan military act, 1967 PA 150, MCL 32.505.

(e) (c) "Owner" means the owner, operator, lessor, or

sublessor of a self-service storage facility or self-contained

storage unit or his or her agent or any other person authorized by

him or her to manage the facility or to receive rent from a tenant

under a rental agreement.

     (d) "Self-service storage facility" or "facility" means any

real property designed or used for the purpose of renting or

leasing individual storage space to tenants who are to have access

to that space for the purpose of storing and removing personal

property.

     (f) "Rental agreement" means an agreement or lease that

establishes or modifies terms, conditions, rules, or any other

provision concerning the use and occupancy of a self-service

storage facility or use of a self-contained storage unit.

(g) (e) "Self-contained storage unit" means a unit not less

than 500 cubic feet in size, including, but not limited to, a

trailer, box, or other shipping container, that is leased by a

tenant primarily for use as storage space whether the unit is

located at a facility owned or operated by the owner or at another

location designated by the tenant.

     (h) "Self-service storage facility" or "facility" means any

real property designed or used for the purpose of renting or

leasing individual storage space to tenants who are to have access

to that space for the purpose of storing and removing personal

property.

     (i) "Service member" means a member of the armed forces, a

reserve branch of the armed forces, or the Michigan national guard.

(j) (f) "Tenant" means a person or the person's sublessee,

successor, or assign entitled to the use of storage space to the

exclusion of others at a self-service storage facility or in a

self-contained storage unit under a rental agreement.

     Sec. 3. (1) The owner of a self-service storage facility or a

self-contained storage unit and the heirs, personal

representatives, successors, and assignees of the owner have a lien

upon all personal property, whether or not owned by the tenant,

located at the self-service storage facility or self-contained

storage unit for rent or other lawful charges incurred relative to

the storage of the personal property, including expenses necessary

for its preservation, or reasonably incurred in its sale pursuant

to this act. The lien attaches as of on the date the personal

property arrives at the self-service storage facility or self-

contained storage unit or the date a rental agreement for the

storage space is signed by the tenant, whichever is earlier.

     (2) The priority of a lien under this act shall be is as

provided in section 5(13).

     (3) If a tenant defaults on a rental agreement, the owner

shall give notice to all holders of a perfected security interest

under the uniform commercial code, 1962 PA 174, MCL 440.1101 to

440.11102, in which the tenant is named as a debtor.

     (4) At the commencement of a rental agreement for storage

space at a self-service storage facility or in a self-contained

storage unit, the owner shall provide the tenant with the following

written notice:

     "NOTICE: If you fail to make your required payments, you will

have to vacate the unit or your property may later be sold at a

public sale. Before the sale, you will be notified by first-class

mail and by certified or by electronic mail of the amount due. The

notice will be mailed to your last known address. In order to

preserve your right to be notified, it is important that you notify

us in writing of any change in your mailing address. Also, you

should supply us with the name and address of another person who

can reach you if you are not at your mailing address, and we will

notify that person at the same time and in the same manner as we

notify you.".

     Sec. 4. (1) Upon the failure of a tenant to pay the rent for

the storage space or unit when it becomes due, the owner may,

without notice, not less than 5 days after the date the rent is

due, deny the tenant access to the personal property located in the

self-service storage facility or self-storage self-contained

storage unit.

     (2) The tenant who signs a rental agreement for storage space

at a self-service storage facility shall disclose in writing the

identity, including name, address, and telephone number, of the

occupant if the occupant is other than the tenant who signs the

agreement.

     (3) A tenant who is a service member and who is transferred or

deployed overseas on active duty for a period of 180 days or more

may notify the owner of the transfer or deployment. The tenant

shall provide written evidence of the transfer or deployment with

the notice.

     Sec. 5. (1) An owner's lien under section 3 shall be enforced

only as provided in this section.

     (2) The tenant and the person any occupant designated , if

any, by the tenant in section 4(2) shall be notified of the owner's

intent to enforce the owner's lien by written notice delivered in

person, or by certified first-class mail, or by electronic mail to

the tenant's and, if applicable, occupant's last known address. The

notice shall include all of the following:

     (a) An itemized statement of the owner's claim, showing the

sum amount due at the time of the notice and the date when the sum

amount became due.

     (b) A demand for payment within a specified time not less than

14 days after delivery of the notice.

     (c) A conspicuous statement that, unless the claim is paid

within the time stated in the notice, the personal property will be

advertised for sale or other disposition and will be sold or

Senate Bill No. 204 (S-2) as amended November 10, 2009

otherwise disposed of at a specified time and place as provided in

subsection (5).

     (d) The name, street address, and telephone number of the

owner whom the tenant may contact to respond to the notice.

     (e) A statement that if the tenant is a service member and is

transferred or deployed overseas on active duty for a period of 180

days or more, the tenant is entitled to give the owner notice of

that transfer or deployment and is entitled to protections under

this act or other law.

     (3) A notice given pursuant to this section shall be presumed

delivered when it is deposited with the United States postal

service and properly addressed with postage prepaid or when it is

transmitted by electronic mail to the tenant's last known

electronic mail address. [An owner who gives notice under subsection (2)

 shall make an affidavit stating how and when the notice was delivered to the tenant and shall attach a copy of the notice to the affidavit. The owner shall retain the affidavit for introduction into evidence in any potential action under section 6(1).]

     (4) After Subject to subsection (15), after the expiration of

the time given in the notice described in subsection (2), the

contents of the storage space may be moved to another storage space

pending its sale or other disposition under this act.

     (5) After the expiration of the time given in the notice

described in subsection (2), except as provided in subsection (6),

an advertisement of the sale or other disposition shall be

published once a week for 2 consecutive weeks in the print or

electronic version of a newspaper of general circulation in the

area where the self-service storage facility or self-contained

storage unit is located or posted once per week for 2 consecutive

weeks on a publicly available website identified in the rental

agreement. Regardless of whether a sale may involve involves the

property of more than 1 tenant, a single advertisement may be used

to advertise the disposal of property at any 1 the sale. An

advertisement under this section shall include all of the

following:

     (a) A brief, general inventory, as described in subsection

(7), of the personal property subject to the lien that is to be

sold.

     (b) The address of the self-storage facility or the address

where the self-contained storage unit is located and the name of

the tenant.

     (c) The time, place, and manner of the sale or other

disposition. The Subject to subsection (15), the sale or other

disposition shall not take place sooner than 15 days after the

first publication of the advertisement under this section.

     (6) If there is no newspaper of general circulation in the

area where the self-service storage facility or self-contained

storage unit is located and a publicly available website is not

identified in the rental agreement, the advertisement shall be

posted not less than 10 days before the date of the sale or other

disposition in not less than 3 conspicuous places in the

neighborhood where the self-service storage facility or self-

contained storage unit is located.

     (7) The inventory required under subsection (5) shall

reasonably identify the property. However, a A container,

including, but not limited to, a trunk, valise, or box that is

locked, fastened, sealed, or tied in a manner that deters immediate

access to its contents , may be described as being in such a that

condition, and no a description of that the container's contents is

not required. However, any a container closed in such a manner may

be opened and its contents inventoried, and those conducting the

inventory, the owner, its and the owner's employees, agents, and

representatives shall are not be liable for incidental damage to

the container caused by the inventory.

     (8) A sale or other disposition of the personal property under

this section shall conform to the terms of the notification as

provided in this section , and shall be conducted in a commercially

reasonable manner.

     (9) Before a sale or other disposition of personal property

under this section, the tenant may pay the amount necessary to

satisfy the lien and the reasonable expenses incurred under this

section to redeem the personal property. Upon receipt of the

redemption sum amount, the owner shall return the personal property

to the tenant. After returning the personal property to the tenant

under this subsection, the owner shall is not be liable to any

person concerning that personal property. If the tenant fails to

redeem the personal property or satisfy the lien, including

reasonable expenses under this section, the tenant shall be

considered to have unjustifiably abandoned the personal property

and the owner may resume possession of the self-service storage

facility or self-contained storage unit.

     (10) Before the sale of a motor vehicle, aircraft, mobile

home, moped, motorcycle, snowmobile, trailer, or watercraft, the

owner shall contact the secretary of state and any other

governmental agency as may be reasonably expected shall be

contacted necessary to determine the name and address of the title

holders or lienholders of those items the item, and the owner shall

notify every identified title holder or lienholder shall be

notified of the time and place of the proposed sale. The owner is

liable for notifying the holder of a security interest only if the

security interest is filed under the name of the person signing the

rental agreement, the tenant, or an occupant identified in section

4(2). An owner who fails to make the lien searches required by this

section shall be is liable only to valid lienholders injured by

that failure as provided in section 6.

     (11) Before the sale of personal property under this act, a

holder of a prior lien on a motor vehicle, aircraft, mobile home,

moped, motorcycle, snowmobile, trailer, or watercraft to be sold

may pay the owner the amount of the owner's lien attributable to

storage of the property, including the reasonable expenses incurred

by the owner under this section. The amount payable to the owner

shall not exceed the equivalent of 4 months' rent. A payment made

to the owner shall be added to the amount of the lien of the prior

lienholder who made the payment and shall be subtracted from the

amount of the owner's lien.

     (12) A purchase purchaser in good faith of the personal

property sold under this section takes the property free of any

right of a person against whom the lien was valid, despite

noncompliance by the owner with the requirements of this section.

     (13) In the event of a sale under this section, the party A

person conducting the a sale under this section shall distribute

the proceeds in the following sequence:

     (a) First, to satisfy the owner's liens up to an amount

equivalent to 4 months' rent, minus any amount already paid the

owner pursuant to subsection (11).

     (b) Second, to satisfy outstanding balances owed to prior

perfected lienholders.

     (c) Third, to satisfy the balance of the owner's liens.

     (14) Any proceeds of the a sale under this section remaining

after the distribution is made under subsection (13) shall be

returned to the tenant by mailing the proceeds to the tenant's last

known address by certified mail and by notifying the tenant by

first-class mail. If the tenant does not claim the remaining

proceeds within 2 years after the date of sale, the remaining

proceeds shall escheat to the this state. The owner shall maintain

proper records of money received in any sale held under this

section, and the records shall be are subject to audit by the state

department of treasury.

     (15) If an owner receives a notice with supporting evidence

under section 4(3) from a tenant, the owner shall not enforce an

owner's lien until 90 days after the end of the tenant's overseas

service.