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This entry was published on 2014-12-26
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SECTION 7-210
Enforcement of Warehouse's Lien
Uniform Commercial Code (UCC) CHAPTER 38, ARTICLE 7, PART 2
Section 7--210. Enforcement of Warehouse's Lien.

(a) Except as otherwise provided in subsection (b), a warehouse's lien
may be enforced by public or private sale of the goods, in bulk or in
packages, at any time or place and on any terms that are commercially
reasonable, after notifying all persons known to claim an interest in
the goods. The notification must include a statement of the amount due,
the nature of the proposed sale, and the time and place of any public
sale. The fact that a better price could have been obtained by a sale at
a different time or in a method different from that selected by the
warehouse is not of itself sufficient to establish that the sale was not
made in a commercially reasonable manner. The warehouse sells in a
commercially reasonable manner if the warehouse sells the goods in the
usual manner in any recognized market therefore, sells at the price
current in that market at the time of the sale, or otherwise sells in
conformity with commercially reasonable practices among dealers in the
type of goods sold. A sale of more goods than apparently necessary to be
offered to ensure satisfaction of the obligation is not commercially
reasonable, except in cases covered by the preceding sentence.

(b) A warehouse may enforce its lien on goods, other than goods stored
by a merchant in the course of its business, only if the following
requirements are satisfied:

(1) All persons known to claim an interest in the goods must be
notified.

(2) The notification must include an itemized statement of the claim,
a description of the goods subject to the lien, a demand for payment
within a specified time not less than ten days after receipt of the
notification, and a conspicuous statement that unless the claim is paid
within that time the goods will be advertised for sale and sold by
auction at a specified time and place.

(3) The sale must conform to the terms of the notification.

(4) The sale must be held at the nearest suitable place to where the
goods are held or stored.

(5) After the expiration of the time given in the notification, an
advertisement of the sale must be published once a week for two weeks
consecutively in a newspaper of general circulation where the sale is to
be held. The advertisement must include a description of the goods, the
name of the person on whose account the goods are being held, and the
time and place of the sale. The sale must take place at least fifteen
days after the first publication. If there is no newspaper of general
circulation where the sale is to be held, the advertisement must be
posted at least ten days before the sale in not fewer than six
conspicuous places in the neighborhood of the proposed sale.

(c) Before any sale pursuant to this section, any person claiming a
right in the goods may pay the amount necessary to satisfy the lien and
the reasonable expenses incurred in complying with this section. In that
event, the goods may not be sold but must be retained by the warehouse
subject to the terms of the receipt and this article.

(d) A warehouse may buy at any public sale held pursuant to this
section.

(e) A purchaser in good faith of goods sold to enforce a warehouse's
lien takes the goods free of any rights of persons against which the
lien was valid, despite the warehouse's noncompliance with this section.

(f) A warehouse may satisfy its lien from the proceeds of any sale
pursuant to this section but shall hold the balance, if any, for
delivery on demand to any person to which the warehouse would have been
bound to deliver the goods.

(g) The rights provided by this section are in addition to all other
rights allowed by law to a creditor against a debtor.

(h) If a lien is on goods stored by a merchant in the course of its
business, the lien may be enforced in accordance with subsection (a) or
(b).

(i) A warehouse is liable for damages caused by failure to comply with
the requirements for sale under this section and, in case of willful
violation, is liable for conversion.