As I understand it, a payment default triggers a process in which the storage facility locks the unit and auctions the storage unit contents. Is there any mechanism that:

  1. prevents the defaulter from bidding?
  2. prevent a straw-man bidder from bidding on behalf of the defaulter?

UPDATE: The concern is that in a scenario where the defaulter is the only bidder, he could conceivably recover his / her assets without paying the bill for $1 or other unreasonable figure.

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    Is there any particular reason why you think such a mechanism might exist? I wouldn't expect it - the goal of the auction is for the storage facility to recover the money it's owed. If the defaulter wants to get involved and help bid up the price, it's beneficial to the storage company. – Nate Eldredge Aug 5 '19 at 21:46
  • Per your update: assuming an efficient market, if nobody else is interested in bidding on the goods, then presumably they are of no value. So the storage facility still gets $1 more than they otherwise would. – Nate Eldredge Aug 5 '19 at 23:10

According to Florida section 83.806 (6) (which the link in the question amends)

Before any sale or other disposition of personal property pursuant to this section, the tenant may pay the amount necessary to satisfy the lien and the reasonable expenses incurred under this section and thereby redeem the personal property. Upon receipt of such payment, the owner shall return the property to the tenant and thereafter shall have no liability to any person with respect to such personal property. If the tenant fails to redeem the personal property or satisfy the lien, including reasonable expenses, he or she will be deemed to have unjustifiably abandoned the self-service storage facility or self-contained storage unit, and the owner may resume possession of the premises for himself or herself.

Thus the owner may pay-up and stop the sale at any time before the sale occurs. There is nothing in the law preventing the former owner from bidding in person or via an agent, at such a sale. But it is hard for me to see why this route would be taken rather than simply paying the back rent due.

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  • Having attended one or two of these sales, I suggest that the defaulting party may be able to out-bid the competitors, knowing the real value of the stored property. The high bid may be less than the amount owed on the rental, depending on how far in arrears the renter is and how much latitude the facility permits. – fred_dot_u Aug 5 '19 at 21:58
  • I believe that if the bid is less than the amount owed, the tenant may still be billed fr the balance, and sued if s/he does not pay. – David Siegel Aug 5 '19 at 22:06
  • A sensible consideration! – fred_dot_u Aug 5 '19 at 22:11
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    @fred I suppose if the defaulter has fled and changed names or is in hiding, a straw purchaser for less than the back rent might make sense, but that sounds more like a mystery novel than a frequent real occurrence, and it seems the law hasn't bothered providing for this somewhat unusual situation. – David Siegel Aug 5 '19 at 22:19
  • @DavidSiegel The concern is a scenario in which the defaulter takes advantage of a situation of a low-demand auction mechanism to acquire the goods. – gatorback Aug 6 '19 at 13:31

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