57A-7-210 Enforcement of warehouse's lien.
57A-7-210.
Enforcement of warehouse's lien.
(a) Except as otherwise provided in subsection
(b), a warehouse's lien may be enforced by public or private sale of the goods, in bulk or in packages,
at any time or place and on any terms that are commercially reasonable, after notifying all persons
known to claim an interest in the goods. The notification must include a statement of the amount
due, the nature of the proposed sale, and the time and place of any public sale. The fact that a better
price could have been obtained by a sale at a different time or in a different method from that
selected by the warehouse is not of itself sufficient to establish that the sale was not made in a
commercially reasonable manner. The warehouse has sold in a commercially reasonable manner if
the warehouse sells the goods in the usual manner in any recognized market therefor, sells at the
price current in that market at the time of the sale, or has otherwise sold in conformity with
commercially reasonable practices among dealers in the type of goods sold. A sale of more goods
than apparently necessary to be offered to ensure satisfaction of the obligation is not commercially
reasonable, except in cases covered by the preceding sentence.
(b) A warehouse's lien on goods, other than goods stored by a merchant in the course of its
business, may be enforced only if the following requirements are satisfied:
(1)
All persons known to claim an interest in the goods must be notified.
(2)
The notification must include an itemized statement of the claim, a description of the
goods subject to the lien, a demand for payment within a specified time not less than ten
days after receipt of the notification, and a conspicuous statement that unless the claim
is paid within that time the goods will be advertised for sale and sold by auction at a
specified time and place.
(3)
The sale must conform to the terms of the notification.
(4)
The sale must be held at the nearest suitable place to where the goods are held or stored.
(5)
After the expiration of the time given in the notification, an advertisement of the sale must
be published once a week for two weeks consecutively in a newspaper of general
circulation where the sale is to be held. The advertisement must include a description of
the goods, the name of the person on whose account the goods are being held, and the
time and place of the sale. The sale must take place at least fifteen days after the first
publication. If there is no newspaper of general circulation where the sale is to be held,
the advertisement must be posted at least ten days before the sale in not less than six
conspicuous places in the neighborhood of the proposed sale.
(c) Before any sale pursuant to this section, any person claiming a right in the goods may pay the
amount necessary to satisfy the lien and the reasonable expenses incurred in complying with this
section. In that event, the goods may not be sold but must be retained by the warehouse subject to
the terms of the receipt and this chapter.
(d) A warehouse may buy at any public sale held pursuant to this section.
(e) A purchaser in good faith of goods sold to enforce a warehouse's lien takes the goods free of
any rights of persons against which the lien was valid, despite the warehouse's noncompliance with
this section.
(f) A warehouse may satisfy its lien from the proceeds of any sale pursuant to this section but
shall hold the balance, if any, for delivery on demand to any person to which the warehouse would
have been bound to deliver the goods.
(g) The rights provided by this section are in addition to all other rights allowed by law to a
creditor against a debtor.
(h) If a lien is on goods stored by a merchant in the course of its business, the lien may be
enforced in accordance with subsection (a) or (b).
(i) A warehouse is liable for damages caused by failure to comply with the requirements for sale
under this section and, in case of willful violation, is liable for conversion.
Source: SL 2009, ch 254, § 7-210.