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April 23, 2012

Fine Print Trips Up Storage Warrior

Filed under: Uncategorized — Edgar (aka MrConsumer) @ 5:49 am

Riding the wave of two popular TV programs about auctioning off the contents of unclaimed storage lockers (“Storage Wars” and “Auction Hunters”), Mouse Print* reader Tony P. recently found himself in a storage war of his own.

Back in 2004, Tony stored nearly 40 years of household goods in a five-foot by 10-foot storage room in New York. He paid about $125 a month to the storage company, now known as Storage Deluxe, LLC. To make sure he didn’t forget a payment, and risk having his goods auctioned off as they do on these TV shows, he had his credit card automatically charged every month.

In August 2009, Tony went to the storage facility and tried to get into his locker. To his horror, he discovered that all his stuff had been removed, and either sold or discarded. When he confronted the company, they said “someone” had come in during December 2008, and had signed a form closing down the unit. The signature was not Tony’s. And it appears that this mystery person never unloaded the locker, but rather the company did, without any notification to Tony. All his stuff was gone.

Tony went to court, suing the storage company for some $80,000 in losses, $21,000 of which he could document with receipts, claiming breach of contract, gross negligence, and violation of New York’s storage law. The judge issued his decision just a couple of weeks ago, ruling mostly against Tony, and relying on fine print in the original contract:


The judge took this clause to mean that the storage facility was only liable for up to $5000 since the renter was not allowed to store anything of greater value in the locker without permission. And since the minimum amount his court had jurisdiction over was $15,000, the judge kicked the case back to a lower district court.

With all due respect to this judge, this clause said nothing about the storage company being liable or not liable for losses of only a certain amount. (And another New York court apparently previously had struck down this clause as an impermissible limitation on liability.)

So Tony is left without his stuff, but has lawyer bills that will eat up most of the $5000 if he decides to settle with the storage company. He has just decided not to appeal the decision, upon the advice of several lawyers.

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  1. I think I would have pursued criminal fraud charges against the storage facility. They were negligent.

    Comment by Shawna — April 23, 2012 @ 9:55 am
  2. I guess filing criminal charges against the storage company for theft is out of the question? Seems to me that there was both theft of services (if Tony was still paying for the storage) and theft of property since the owners were the ones who disposed of his stored goods.

    Comment by PCnotPC — April 23, 2012 @ 1:25 pm
  3. So does this mean nothing of value can be put in a storage locker???

    If Tony was paying 125 bucks a month for that locker and the storage company now known as Storage Deluxe, LLC. kept on getting the payment on time they had no right to remove anything from the locker.

    He should get 80,000 or even more due to how hard it will be to replace all the stuff removed from the locker.

    Comment by Richard Ginn — April 23, 2012 @ 5:46 pm
  4. Agreeing with PCnotPC:

    What about the unknown person who closed out the account? In all the dealings I’ve had with storage companies, they needed drivers licenses and ID’s in order to both start a contract and end that contract. Also, they should have had some sort of mail sent to Tony, either at the time of the account closing (December 2008) or when the items were disposed of (August 2009). Before they can legally dispose of stored items, I believe they have to serve some sort of notice. Has Tony moved without giving a new address? Changed email without updating the storage company files? Tony’s bad.

    I do not have the automatic withdrawal on my storage unit and I get reminder emails of my upcoming payment due every month. Do you get some sort of email indicating the successful payment, other than the money coming out of the bank (or credit card)?

    I sympathize with Tony, but I see the courts side also. The contract is the contract. No added value insurance and you’re stuck with the $5000 limit. Who’s to claim many thousands of dollars worth of ‘stuff’, when in actuality you have a box of old paperwork, some furniture etc. in the unit. I am not doubting Tony claim of $80000, though.

    Comment by BobL — April 23, 2012 @ 6:37 pm
  5. Perhaps I am too much simple-minded.

    But to my mind, this appears to be a clear case of negligence on the part of the service provider. At least here in India there are precedences when the courts have awarded exemplary damages in cases of this type.

    Dondu N. Raghavan

    Comment by N. Raghavan — April 24, 2012 @ 8:21 pm
  6. I agree about the storage company being paid long after the supposed contract was canceled makes them responsible for the contents. Also, if the storage company auctioned or sold off the contents, then that money belongs to Tony since it was his stuff. The company also stole $125/month and that is illegal.

    Comment by Art — April 25, 2012 @ 5:38 pm
  7. Any further comments from Tony? After all of us armchair lawyers chimed in?

    Seems to me he would have a good case, at least for the $5000. Small claims court?

    Edgar replies: Bob, he was exploring one other option, but he is likely to accept their $5000 settlement offer. He cannot sue again on the same subject because of the legal concept “res judicata” — the thing has already been decided.

    Comment by BobL — May 3, 2012 @ 8:20 pm
  8. Thanks Edgar and all- to address your comments/ questions:

    – The staffer who permitted a stranger to close my account was never disclosed and “no longer works there.”

    – No effort was ever made to investigate or pursue the stranger who signed the account closure. No effort was made to check security cameras, which monitored the service counter at the storage facility.

    – I never had changed address nor phone number. Storage Deluxe had my correct contact information on file as evidenced by a promotional mailing I received around the same time.

    – The “added value insurance” that the facility advertises has a cap on it of — you guessed it– $5,000. So had I ever bought it, I would have wasted money because the facility’s contract entitled me to the same recovery by default. The only thing their “insurance plan” would have saved me is going to court for the money.

    – This has become akin to the “perfect crime:” Storage Deluxe has been put, by the court, in a “teflon” position. The DA’s office won’t touch the case from a forgery standpoint because they can’t pin the crime to one person. No Consumer Protection agency can do anything. The Police Dept. turned me to civil court from Day One. My homeowners insurance won’t cover it unless it’s a crime. To complicate matters, the actual facility where it happened is no longer run by Storage Deluxe.

    – There is case precedence where their liability should NOT be limited to $5K in a case of egregious negligence. It seems the Superior Court judge overlooked or ignored this in favor of the almighty contract.

    – I wrote a letter to the CEO of Storage Deluxe, Nick Coslov, expressing my feelings on the way his company has cavalierly handled the matter since Day One. I have not received the courtesy of any reply.

    All options seems to have been exhausted. Why a corporation that serves millions of people in the NYC metro area would act this way in a self-admitted mistake towards a six-year good customer (and neighbor) is amazing to me.

    Comment by TonyP — May 7, 2012 @ 9:02 am

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