Legal Question in Business Law in California

Storage Facility

If the owner of a storage facility in California has a public auction to sell goods in lien, must a licensed auctioneer be hired to conduct the sale? Or can any person acting as the owner's agent conduct the sale?

The following is all I could find regarding this issue and it does not say a licensed auctioneer must be hired, although I have been told this is so. Can you please clarify?

California Code: 21707

... (b) The sale shall be conducted in a commercially reasonable

manner, and, after deducting the amount of the lien and costs of

sale, the owner shall retain any excess proceeds of the sale on the

occupant's behalf. ... 'Commercially reasonable manner' does not indicate to me that one would 'by law' have to hire a licensed auctioneer, but am awaiting your advice. Thank you for your consideration in this matter.


Asked on 2/03/07, 6:48 pm

1 Answer from Attorneys
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Storage Facility

"Commercially reasonable manner" would include anything that a prudent, experienced and thoughtful businessperson would do, and what is reasonable for some types of stored goods might be unreasonable for others. For instance, with medium-value items that are easy to ship, maybe selling on eBay is reasonable. If it's boxes of real jewelry, maybe using Sotheby's is warranted. If the unit is full of motheaten furniture, maybe a consignment store is the best way to maximize the net cash.

I do not read Business and Professions Code 21707 to require an auction at all, much less a licensed auctioneer. However, there may be some instances where a licensed auctioneer is the only reasonable way to go.

Use of well-intentioned common sense is really what's required. The law does not expect the warehouseman to incur more selling costs than the stuff is likely to bring.

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Answered on 2/03/07, 7:13 pm


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