Advertising and Conducting a Lien Sale
Two requirements govern the sale itself. The advertisement must run where and for as long as the statute says, and the sale must be conducted in a commercially reasonable manner, a standard borrowed from secured transactions law.
The rule in short
Before a lien sale the operator must publish an advertisement, typically once a week for two consecutive weeks in a newspaper of general circulation in the area, with a posting alternative where no such newspaper exists. Statutes increasingly recognize online auction sites, either as a substitute publication or as the sale venue. The sale itself must be conducted in a commercially reasonable manner, which addresses method, publicity and timing rather than price alone.
The sale is the step everyone pictures and the step with the least discretion in it. Two separate requirements apply: the advertisement must appear where and when the statute directs, and the sale must be conducted in a commercially reasonable manner. The first is a checklist. The second is a standard, and it is where most argument happens afterwards.
The publication requirement
After the notice period expires, the operator must advertise the sale. The dominant formulation requires publication once a week for two consecutive weeks in a newspaper of general circulation published in the area where the facility is located.
The advertisement must include the name of the person on whose account the goods are being stored, the name and location of the facility, a brief and general description of what is believed to constitute the property, and the time, place and manner of the sale. Where a single sale disposes of property belonging to more than one tenant, a single advertisement may cover it.
Timing is fixed relative to publication rather than to the notice. A representative provision requires the sale to take place at least fifteen days after the first publication, which means the advertisement schedule, not the demand letter, sets the earliest sale date.
When there is no qualifying newspaper
Newspaper coverage has thinned, and the statutes have adapted in two ways.
The traditional fallback is posting. Where no newspaper of general circulation is published in the relevant area, the advertisement must be posted for a stated period before the sale in a stated number of conspicuous places in the neighborhood of the proposed sale. The number and the period vary, commonly three to six places and ten days.
The newer alternative is online publication. Several statutes now permit publication once in a newspaper combined with an advertisement on a publicly accessible internet website that customarily conducts or advertises online auctions or sales, with the online advertisement required to remain online for a stated number of days before the sale.
Both alternatives are conditional. A facility that skips the newspaper because it prefers an online listing, in a state where the online route is only available in combination, has not advertised in a manner the statute recognizes.
| Route | What it requires | Earliest sale |
|---|---|---|
| Newspaper only | Publication once a week for two consecutive weeks in the area | A stated number of days after first publication |
| Newspaper plus online | One newspaper insertion plus an online listing kept up for a stated period | After the online period has run |
| Posting | Notices in several conspicuous places in the neighborhood | A stated number of days after posting |
| Online auction as venue | Sale conducted on a site that customarily runs auctions | As advertised, once the publication requirement is met |
What commercially reasonable means
The sale must be conducted in a commercially reasonable manner. The phrase is borrowed from secured transactions law and carries that body of learning with it.
The standard looks at the method, manner, time, place and terms of the sale. It asks whether the seller acted as a reasonable seller in that market would have acted to obtain value, not whether the price was good. A low price does not by itself establish a failure, but a low price obtained by a poorly publicized sale, at an inconvenient time, on unusual terms, is evidence of one.
Several statutes now state expressly that a commercially reasonable manner includes an in-person auction or a sale on a publicly accessible internet website that customarily conducts online auctions. That is a safe harbor rather than a limitation: other methods remain available if they meet the standard.
What consistently fails the standard is a sale that was not really a market. A sale conducted without meaningful publicity, restricted to invited bidders, or held at a time and place chosen to minimize attendance produces exactly the objection the standard exists to catch.
The standard also governs how lots are constituted. Selling the entire contents of a unit as one lot is normal practice and is generally reasonable, because inspecting and valuing individual items would cost more than the goods are worth. Where a unit plainly contains one item of substantial value among ordinary household goods, selling everything together at a single low price is harder to defend, and a seller aware of the disparity is expected to account for it.
An operator defending a sale will be asked what was advertised, where, for how long, how many bidders participated, what bids were received and how the winning bid was determined. A sale conducted on an online platform generates that record automatically. A sale conducted informally on site frequently generates none, and the absence of a record is what converts an arguable price into an indefensible one.
Redemption up to the moment of sale
The occupant's right to stop the sale runs until it happens. Before any sale or disposition, the tenant may pay the amount necessary to satisfy the lien and the reasonable expenses incurred, and thereby redeem the property. On receipt of payment the operator must return the property and thereafter has no liability to any person with respect to it.
Two practical points follow. First, the amount required is the lien plus reasonable expenses actually incurred, not a figure the operator prefers. Publication costs and labor genuinely spent are recoverable; an administrative fee invented for the occasion invites a challenge to the entire process.
Second, an operator that has advertised a sale and then receives payment must stop the sale, including on an online platform where a listing may run to a fixed end date. Selling property that has been redeemed is a conversion regardless of how far the process had gone.
After the sale
A purchaser in good faith takes the property free of claims, and several statutes say so expressly, subject only to stated exceptions and despite noncompliance by the operator with the procedural requirements. That protection is for the buyer, not for the operator: the tenant's remedy shifts from the goods to a claim against the facility.
The proceeds are then applied in a statutory order and any surplus is held for the tenant, subject to a claim period after which the funds are treated as abandoned or escheat. That mechanism is set out under applying the proceeds and what happens to a surplus.
Where the unit contained a titled vehicle or a watercraft, the sale route may be different, and several statutes direct the operator either to sell under the storage act or to have the vehicle towed and disposed of under the vehicle lien statute instead. Those constraints are covered under property a lien sale cannot simply sell, and the notice steps that must precede any of this are set out under default and the notice sequence before a sale.
Points to carry away
- Publication is commonly required once a week for two consecutive weeks in a newspaper of general circulation.
- Where no qualifying newspaper exists, statutes substitute posting in several conspicuous places for a stated period.
- The advertisement must identify the tenant, the facility and describe the property generally.
- Many statutes now recognize a publicly accessible online auction site as a permitted venue or publication route.
- A commercially reasonable sale is judged by method, manner, time, place and terms rather than by price alone.
Questions readers ask
Can the facility operator bid at its own sale?
This is one of the sharper questions in the field and the answer varies. Where an operator or its employee buys the contents, the sale invites the objection that it was not conducted to obtain value for the occupant, and several statutes restrict purchases by the lienholder or require any such sale to meet a heightened standard. Even where no express prohibition exists, an operator that buys at its own auction has undermined the commercial reasonableness of the sale and will struggle to defend the price obtained.
How specific does the property description have to be?
Statutes ask for a brief and general description of what is believed to constitute the property in the unit, and for the description to be consistent with the one used in the notice to the tenant. Operators are not required to inventory the contents, and in most states they should not enter and catalogue beyond what the statute permits. The description exists so a tenant reading an advertisement can recognize their own unit and so bidders know roughly what is on offer, not to produce a valuation.
What happens if nobody bids?
Statutes generally allow the property to be otherwise disposed of where a sale produces no buyer, and the notice and advertisement language is usually drafted to cover sale or other disposition for that reason. Disposal does not permit the operator to keep the goods: the operator that retains items rather than selling or discarding them has converted them. The prudent course is to record what was offered, what bids were received, and what was done with the property afterwards.
Sources
- California Business and Professions Code § 21707 — Advertisement and saleSets the publication routes, the online alternative and the commercially reasonable standard.
- Florida Statutes § 83.806 — Enforcement of lienRequires publication once a week for two weeks and a sale at least fifteen days after first publication.
- California Business and Professions Code § 21706 — Sale after no oppositionPermits the operator to proceed to sale once the opposition window closes.
- California Business and Professions Code § 21708 — Redemption before salePreserves the occupant's ability to pay and recover the property before the sale.
- U.C.C. § 7-210 — Enforcement of warehouse's lienSupplies the commercially reasonable sale standard and its safe harbors.
- U.C.C. § 7-209 — Lien of warehouseEstablishes the lien whose enforcement the sale provisions govern.
Metro Law Advisors is a publication, not a law firm. This article states general rules and cites its sources; it is not advice about any particular case, and the law differs by state and changes over time.
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