Self Storage and Homeland Security: Are Facilities and Their Tenants Safe?
By Self Storage Legal Network (SSLN)
Security is on everyone’s mind these days, including self storage operators. Whether it’s a concern for tenant safety or the risk of criminal activity at their facilities, owners are being forced to consider more carefully who their tenants are and what rights the operators have to protect their property and their tenants.
Previously it was considered unorthodox for a facility operator to get a photograph of their tenants for identity verification. Now, we see some facilities fingerprinting tenants and other facilities even performing background checks on prospective tenants. Why? Well, the first answer is potential liability. Owners may be considered liable for damages to their tenants and others if they rent storage spaces to individuals who use them to commit crimes and people are injured or property is damaged. The second reason is that, as technology improves, the resources are at our fingertips to access the information to determine who might be a threat to the facility if they are allowed to rent space.
Take, for example, the new SSA Countermeasures program. This service allows operators to quickly obtain, through the internet, tenant identity verification, credit scoring and even background checks. Now, even though that information may be available, the more difficult question may be how to properly (and legally) use that information. Will a tenant be turned away if they have bad credit, even though self storage rental is only on a month-to-month basis? Will a tenant be turned away if they have a criminal record, although the crime has nothing to do with property theft? These questions will need answers so that a facility operator who chooses to access this information can make an informed decision as to how to use the information properly. One certain answer is that, with this new resource, the facility operator must act consistently in its leasing decisions. Certainly, in a perfect world, a facility would have the luxury of making sure that all of its tenants have perfect credit and no criminal history. However, if a facility does its job in securing the facility and looks for mysterious behavior by its tenants that might just be the best way to deter the risk of crime on the property.
What rights does an operator have in turning away prospective tenants, whether the decision is based upon credit or criminal information or simply due to how the prospective tenant fills out their lease information? The answer is that the operator does have the right to choose its tenants, as long as the leasing decisions are made consistently and without discrimination.
It is illegal for a self storage operator to deny occupancy to an otherwise appropriate tenant based on a person’s national origin, race, color, religion, disability, sex or familial status. There are laws that specifically provide that people cannot be denied “equal opportunity” because they or their family are from another country, because they have a name or accent associated with a national origin group or because they are married to or associate with people of a certain national origin. For example, there have been cases brought against restaurants where one ethnic group of patrons were treated differently than another group of patrons and against hotels where certain visitors were required to pay higher rates and in cash compared to other guests who were allowed to use credit cards. Although racial profiling has been used by the police in the context of traffic stops and the search for contraband, it continues to be a hotly debated civil rights subject. There continue to be discussions about stopping the practice since it apparently challenges the equal protection rights of those affected. After the events of September 11th, Congress passed a law known as the USA Patriot Act, which focused on ways to limit terrorism in the United States. However, one of the statements and concerns contained in the law was a fear that bigotry would occur against Muslim and Sikh-Americans. This Federal law condemns such bigotry and calls upon law enforcement to specifically prosecute those who commit crimes against these individuals.
Essentially, when it comes to self-storage, the answer is that rather than judging tenants based upon ethnic or racial criteria, operators can certainly have (and should have) a set of requirements that must be met by all prospective tenants before they can rent space. These requirements can include the need for picture I.D.’s, verifiable addresses and social security confirmation. It can also include credit and criminal background checks. Whatever the facility’s policies might be, they should be applied consistently to all tenants so as to avoid discriminatory practices. If a facility has a required procedure for all of its prospective tenants and someone fails to meet a requirement for tenancy, then that person can be denied the use of the facility. Whether or not a facility operator uses stricter identification or credit/criminal verification methods before they sign up their tenants is an operational decision for the facility owner. The bottom line is that if all tenants are treated the same way, then there can be no claim of unfair treatment.
What else can self storage operators do to secure their facilities? In the increasingly competitive environment between self storage facilities, storage operators have pushed each other to enhance the security devices that their properties offer. We have seen the development of secured fencing, code access gates, disc locks, individual unit door alarms, video cameras, security lighting and even the use of guard dogs. Each of these additional security measures focuses primarily on keeping an unauthorized person from entering the facility and gaining access to a tenant's unit. Those external security measures have almost become a necessary requirement for protecting a tenant's goods from theft. Yet, those security measures have also strengthened the facility's ability to protect its tenants as well. As on all commercial property, there is the risk of a crime occurring against a tenant while on the premises. If such a crime does occur, the property owner and the facility management can potentially be held liable for allowing the crime to occur. Such cases have been filed against hotels and shopping centers, and storage facilities are not immune. The use of external security to keep criminals out enhances a facility's defense against such claims. If a crime does occur, a facility can argue that it attempted to protect its tenants from such crimes by the use of perimeter fencing, gate code access, video cameras, etc. The use of external security can likewise be used to protect a storage facility from vandalism, robbery or other crimes against the property or its personnel. Facility operators should also motivate their tenants to protect themselves from potential theft. For example, stress their use of disc locks rather than combination locks and suggest that they create an inventory list of their property, (including any serial numbers) in case their property is stolen. A facility can better protect itself and its customers by limiting access to regular hours and by avoiding access during off hours. The rental agreement should plainly state that access to the facility can be limited by posted hours as well as due to emergency situations (such as inclement weather or damage to the facility). Certainly, if there are commercial tenants who claim that they need the service of 24-hour access as a requirement of their tenancy, the facility might oblige that request. Yet, there seems to be no true need that could be shown for a typical residential tenant to require 24-hour access to property placed in storage.
Not only must a facility provide the security that it advertises, but it also must maintain its security system so that it is fully operational. Although there are always certain circumstances where gates or cameras may not work, once a facility is given notice of those problems, or discovers the problems itself (through security checks), the facility is duty bound to repair the system. It is the same responsibility a facility owner takes to maintain the structures, walkways and driveways of the property and other areas of the facility which require upkeep. A facility owner that allows a driveway pothole to remain without repair assumes the potential liability for an injury arising from that condition. Similarly, a facility owner that leaves a hole in its fence or its front gate open, assumes liability where crimes may occur as a result of the lack of security. With both facility and security maintenance, it is crucial for a facility operator to maintain the proper documents to record its maintenance and repair efforts. Again, a facility that does not adequately maintain its property assumes a tremendous risk of liability for losses arising from those unkempt conditions. When a claim arises, proper record keeping can assist a facility in defending its position that it acted responsibly in responding to needed repairs.
Without a doubt, operators can also further protect their facilities through the use of inspections. Operators clearly have the right to inspect the property being stored in their facility. First, there should be a “use” provision in every rental agreement that limits the contents of what can be stored in a storage unit. A standard provision might read: “The space named herein is to be used by the Tenant solely for the purpose of storing any personal property belonging to the Tenant. The Tenant agrees not to store any explosives, or any flammable, odorous, noxious, corrosive, hazardous or pollutant materials or any other goods in the space which would cause danger or nuisance to the space or facility. The Tenant agrees that the property will not be used for any purposes unlawful or contrary to any ordinance, regulation, fire code or health code and the Tenant agrees not to commit waste, nor to create a nuisance, nor alter or affix signs on the space, and will keep the space in good condition during the term of the Agreement. The Tenant agrees not to store jewels, furs, heirlooms, art works, collectibles or other irreplaceable items having special or emotional value to the Tenant. There shall be NO HABITABLE OCCUPANCY of the space by humans or pets of any kind for any period whatsoever and violation of these prohibitions shall be grounds for immediate TERMINATION of the Agreement.” Under this provision, a facility operator would have the right to inquire as to what property is being stored by the tenant at the facility to insure that there will be no violation of the contract. If necessary, a facility operator may choose to specifically include in its contract a provision that allows all property and vehicles on the premises to be searched to require compliance with the use provision of the contract.
This inspection right is separate and apart from a landlord’s right to enter a tenant’s unit if necessary for purposes of repair, emergency or to determine if there is a violation of the contract. Such a provision might read: “In cases where Owner considers it necessary to enter the space for purposes of examining the space for violation of this agreement or condition in the space or making repairs or alterations thereto, or to comply with this agreement, or due to emergency, Tenant agrees that Owner, or Owner’s representative, shall have the right without notice to enter into and upon the space and Owner reserves the right to remove contents to another space.”
Self-storage facilities are a common site for law enforcement searches and seizures. In fact, since the recent terrorist attacks, these facility searches have become more prevalent as the government seeks evidence to avoid future attacks. Can the facility operator provide the names of their tenants renting at their facility without the need for a subpoena or even a search warrant? To the extent that a facility operator owns the proprietary right to its rent roll, the operator can choose to divulge whether a particular tenant is renting a unit at their self-storage facility. With that information the authorities can then better support their request for a subpoena for the tenant’s document file and a search warrant to inspect the property stored in the rental unit.
There have been some recent cases that have addressed the issue of plain view searches and reasonable access. In the case of State v. Bobic, the Washington Supreme Court upheld a search by law enforcement of one storage unit when viewed by the police from an adjacent, empty unit. The Court found that the police were authorized to look into the locked unit through a hole in the wall. In another case, U.S. v. DeTurbiville, the Ninth Circuit Court of Appeals upheld the right of authorities to enter a locked storage unit where permission was provided not by the tenant, but by a friend who had been given the key and code to the unit. The Court found that the tenant assumed the risk that his friend would allow others to enter the unit, even the police.
As the likelihood of these police searches increase, facility operators should consider amending their rental agreements to explain the operator’s rights and protections in these matters. For example, the agreement should state that the facility retains the right to provide authorities information concerning all of its tenants. The rental agreement should also state that the facility has the right to enter the unit where it is believed that illegal activity is occurring. By establishing the facility’s rights in the rental agreement, there is less of a risk to the operator of tenant trespass claims.
The Self Storage Association, Inc. (SSA) is a nonprofit trade association and does not provide legal services to its members or the members of the Self Storage Legal Network (SSLN). The SSA only provides administrative and marketing support to the SSLN for a fee. The Self Storage Legal Network (“SSLN”) is not a part of the Self Storage Association, nor is it a law firm, but is an independent consulting service which is made available to Association members for an additional subscription fee. As such, no advice given is part of the ordinary membership benefits of the Association, nor is it given on behalf of the Association. The SSLN does not serve as an attorney for any Association members who subscribe, but does offer timely consultation on the legal aspects of operating problems which may be experienced by its subscribers. The information is provided by experienced licensed attorneys. The SSLN cannot offer advice on disputes between operators who are subscribers, nor can the SSLN represent any subscriber in a lawsuit, or engage in any communication with any person or firm with whom a subscriber may have a dispute. SSLN subscriber members acknowledge that an attorney/client relationship is not created between the SSLN and the subscriber. The advice offered by the SSLN to any inquiring subscriber is based upon the description of the problem offered at the time, and there may be facts or aspects of the problem which are not known, or not adequately communicated by the inquiring subscriber at the time advice is sought. The advice given is intended to be pragmatic and preventative in nature, and based upon the best judgment and experience of the SSLN attorney responding to the inquiry. The subscriber should always follow up with an inquiry to his or her lawyer in the event that further complications or disputes are expected. The SSLN is not a substitute for your lawyer’s advice or representation, and no advice given should be taken as overruling any advice given by your lawyer. In the event of any perceived discrepancy or conflict in the advice given by the SSLN and any advice given by your lawyer, you should consult further with your lawyer to arrive at a definitive course of action. Your own lawyer must always have the last word on how to proceed.