70A-7a-210 - Enforcement of warehouse's lien.
70A-7a-210. Enforcement of warehouse's lien.
(1) Except as otherwise provided in Subsection (2), a warehouse's lien may be enforcedby public or private sale of the goods, in bulk or in packages, at any time or place and on anyterms that are commercially reasonable, after notifying all persons known to claim an interest inthe goods. The notification must include a statement of the amount due, the nature of theproposed sale, and the time and place of any public sale. The fact that a better price could havebeen obtained by a sale at a different time or in a method different from that selected by thewarehouse is not of itself sufficient to establish that the sale was not made in a commerciallyreasonable manner. The warehouse sells in a commercially reasonable manner if the warehousesells the goods in the usual manner in any recognized market therefor, sells at the price current inthat market at the time of the sale, or otherwise sells in conformity with commercially reasonablepractices among dealers in the type of goods sold. A sale of more goods than apparentlynecessary to be offered to ensure satisfaction of the obligation is not commercially reasonable,except in cases covered by the preceding sentence.
(2) A warehouse may enforce its lien on goods, other than goods stored by a merchant inthe course of its business, only if the following requirements are satisfied:
(a) All persons known to claim an interest in the goods must be notified.
(b) The notification must include an itemized statement of the claim, a description of thegoods subject to the lien, a demand for payment within a specified time not less than 10 daysafter receipt of the notification, and a conspicuous statement that unless the claim is paid withinthat time the goods will be advertised for sale and sold by auction at a specified time and place.
(c) The sale must conform to the terms of the notification.
(d) The sale must be held at the nearest suitable place to where the goods are held orstored.
(e) After the expiration of the time given in the notification, an advertisement of the salemust be published once a week for two weeks consecutively in a newspaper of generalcirculation where the sale is to be held. The advertisement must include a description of thegoods, the name of the person on whose account the goods are being held, and the time and placeof the sale. The sale must take place at least 15 days after the first publication. If there is nonewspaper of general circulation where the sale is to be held, the advertisement must be posted atleast 10 days before the sale in not fewer than six conspicuous places in the neighborhood of theproposed sale.
(3) Before any sale pursuant to this section, any person claiming a right in the goods maypay the amount necessary to satisfy the lien and the reasonable expenses incurred in complyingwith this section. In that event, the goods may not be sold but must be retained by the warehousesubject to the terms of the receipt and this chapter.
(4) A warehouse may buy at any public sale held pursuant to this section.
(5) A purchaser in good faith of goods sold to enforce a warehouse's lien takes the goodsfree of any rights of persons against which the lien was valid, despite the warehouse'snoncompliance with this section.
(6) A warehouse may satisfy its lien from the proceeds of any sale pursuant to thissection but shall hold the balance, if any, for delivery on demand to any person to which thewarehouse would have been bound to deliver the goods.
(7) The rights provided by this section are in addition to all other rights allowed by law toa creditor against a debtor.
(8) If a lien is on goods stored by a merchant in the course of its business, the lien may beenforced in accordance with Subsection (1) or (2).
(9) A warehouse is liable for damages caused by failure to comply with the requirementsfor sale under this section and, in case of willful violation, is liable for conversion.
Enacted by Chapter 42, 2006 General Session