Frequently Asked Questions - Protected Property
Protected property consists of those materials the sale or disposal of which is regulated by law, AND which is falls into one of these four classes of property:
• Documents, files or electronic data containing financial, medical, legal or passport information about Occupant’s customers, clients or patients (except Occupant’s personal records). (See: “What constitutes ‘personal information’?”)
• Pharmaceuticals (except those dispensed by a pharmacy for Occupant’s personal use). (See: “What pharmaceuticals are considered protected property?”)
• Alcoholic beverages. (See: “What alcoholic beverages are considered protected property?”)
• Firearms. (See: “Can we sell firearms?”)
• Documents, files or electronic data containing financial, medical, legal or passport information about Occupant’s customers, clients or patients (except Occupant’s personal records). (See: “What constitutes ‘personal information’?”)
• Pharmaceuticals (except those dispensed by a pharmacy for Occupant’s personal use). (See: “What pharmaceuticals are considered protected property?”)
• Alcoholic beverages. (See: “What alcoholic beverages are considered protected property?”)
• Firearms. (See: “Can we sell firearms?”)
Personal information as used in this circumstance is defined by Arizona law. It is an individual's first name (or first initial) and last name, in combination with any one or more of the following:
• The individual's social security number.
• The individual's driver’s license number (or number on a Personal Information individual s driver’s government issued I.D).
• The individual’s credit or debit card number (or financial account number).
Also included would be...
• Passports
• Medical records
• Legal files
NOTE: All of the above relates to records about tenant’s customer, client or patient files, NOT to files about the tenant him/herself, in other words records about others kept in conjunction with tenant’s business.
That said, it is still a wise precaution to remove tenant related files that contain personal information. (See: “What if I don’t know there is protected property in a unit?”)
• The individual's social security number.
• The individual's driver’s license number (or number on a Personal Information individual s driver’s government issued I.D).
• The individual’s credit or debit card number (or financial account number).
Also included would be...
• Passports
• Medical records
• Legal files
NOTE: All of the above relates to records about tenant’s customer, client or patient files, NOT to files about the tenant him/herself, in other words records about others kept in conjunction with tenant’s business.
That said, it is still a wise precaution to remove tenant related files that contain personal information. (See: “What if I don’t know there is protected property in a unit?”)
All kinds. No exceptions.
Pharmaceuticals other than “those dispensed by a pharmacy for Occupant’s personal use,” i.e., not tenant’s prescriptions.
This provision is aimed primarily at storage units rented to drug manufacturers’ sales representatives who very often rent storage space for their sales materials and samples. In the event of a default, the sales materials can be sold, but the samples may not be. Only license pharmacists can sell pharmaceuticals.
That said, it is still a good idea to remove any prescriptions found in a unit prior to sale and to treat them as protected property.
This provision is aimed primarily at storage units rented to drug manufacturers’ sales representatives who very often rent storage space for their sales materials and samples. In the event of a default, the sales materials can be sold, but the samples may not be. Only license pharmacists can sell pharmaceuticals.
That said, it is still a good idea to remove any prescriptions found in a unit prior to sale and to treat them as protected property.
The short answer is yes, provided two things are true:
1) The firearm itself is one that is permitted to be sold by law. Some weapons, e.g., modified or stolen guns, and some types of firearms may not be sold.
2) You are selling to someone to whom you are legally permitted to sell firearms. For example minors in most circumstances cannot be your customer, nor can felons.
Since most of us have no way of confirming that both of these tests can be met, the law permits us to treat all firearms as protected property and not sell them.
1) The firearm itself is one that is permitted to be sold by law. Some weapons, e.g., modified or stolen guns, and some types of firearms may not be sold.
2) You are selling to someone to whom you are legally permitted to sell firearms. For example minors in most circumstances cannot be your customer, nor can felons.
Since most of us have no way of confirming that both of these tests can be met, the law permits us to treat all firearms as protected property and not sell them.
Step 1: Remove it from the storage unit prior to sale. Put it in a separate place of safe keeping. Remember, the tenant has the right to redeem and rescue their property from sale right down to the moment that the sale gavels falls. If that happens, you have to be in a position to return the protected property to the tenant.
Step 2: As soon as practical after the sale of all non-protected contents, the protected property should be “disposed of.”
The law provides two methods for disposing of protected property. It may be:
• Surrendered to an appropriate state or federal authority (see: “What constitutes an ‘appropriate state or federal authority’?”), OR
• It may be destroyed (see: “How should protected property be destroyed?”).
Step 2: As soon as practical after the sale of all non-protected contents, the protected property should be “disposed of.”
The law provides two methods for disposing of protected property. It may be:
• Surrendered to an appropriate state or federal authority (see: “What constitutes an ‘appropriate state or federal authority’?”), OR
• It may be destroyed (see: “How should protected property be destroyed?”).
An appropriate authority would be one that normally oversees or licenses work in a particular discipline. For example:
An attorney’s legal files would be with the purview of the state Bar Association.
Similarly, the following authorities would be appropriate:
An accountant’s client files - State Accountancy Board
A dentist’s patent files - State Dentistry Board
A doctor’s patient files - State Medical Association
A chiropractor’s patent records - State Chiropractic Board
Firearms - Local police
Illegal narcotics - Local police
Legal narcotics (samples) - Federal Drug Enforcement Agency
Other pharmaceuticals - (No authority; destroy)
Alcoholic beverages - State Liquor Control Board*
The authority in each case must be accepted by the authority in question. It cannot simply be dropped off there. It is a good idea to call first, and if the material is accepted, to get a receipt for the tender.
No authority can be counted on to accept tenders of these materials in all instances.
____________
* Note, the Arizona State Liquor Board has indicated that under no circumstances will it accept alcoholic beverages taken from a tenant’s storage space.
An attorney’s legal files would be with the purview of the state Bar Association.
Similarly, the following authorities would be appropriate:
An accountant’s client files - State Accountancy Board
A dentist’s patent files - State Dentistry Board
A doctor’s patient files - State Medical Association
A chiropractor’s patent records - State Chiropractic Board
Firearms - Local police
Illegal narcotics - Local police
Legal narcotics (samples) - Federal Drug Enforcement Agency
Other pharmaceuticals - (No authority; destroy)
Alcoholic beverages - State Liquor Control Board*
The authority in each case must be accepted by the authority in question. It cannot simply be dropped off there. It is a good idea to call first, and if the material is accepted, to get a receipt for the tender.
No authority can be counted on to accept tenders of these materials in all instances.
____________
* Note, the Arizona State Liquor Board has indicated that under no circumstances will it accept alcoholic beverages taken from a tenant’s storage space.
That depends upon what it is. Destroyed is not a relative terms; something is either destroyed or it isn’t.
The law defines destroyed as meaning rendered incapable of being used for a thing’s original purpose. Protected property therefore cannot be considered destroyed it is thrown away in a dumpster. Someone can “undestroy” it simply by taking it back out again.
Paper records should be shredded. You can do it yourself, in which case be sure to have a witness. It is best to use a commercial shredding company which can give you a certificate attesting to the fact that the materials were destroyed.
Pharmaceuticals, other than controlled substances (narcotics), should be crushed and mixed with other garbage. Do not flush drugs down the a toilet. Narcotics should be surrendered to authorities (see: “What constitutes an ‘appropriate state or federal authority’?”).
Alcoholic beverages should be poured out. They can be consumed, but since there will likely be more than can be consumed in one sitting, the material ends up being taken and consumed over time. The difference between that and theft is a very fine line. The appearance of stealing should be avoided.
Firearms should be surrendered to the police (See “Can we sell firearms?”). Police called on their non-emergency number will generally dispatch a patrol car to pick the weapons up.
The law defines destroyed as meaning rendered incapable of being used for a thing’s original purpose. Protected property therefore cannot be considered destroyed it is thrown away in a dumpster. Someone can “undestroy” it simply by taking it back out again.
Paper records should be shredded. You can do it yourself, in which case be sure to have a witness. It is best to use a commercial shredding company which can give you a certificate attesting to the fact that the materials were destroyed.
Pharmaceuticals, other than controlled substances (narcotics), should be crushed and mixed with other garbage. Do not flush drugs down the a toilet. Narcotics should be surrendered to authorities (see: “What constitutes an ‘appropriate state or federal authority’?”).
Alcoholic beverages should be poured out. They can be consumed, but since there will likely be more than can be consumed in one sitting, the material ends up being taken and consumed over time. The difference between that and theft is a very fine line. The appearance of stealing should be avoided.
Firearms should be surrendered to the police (See “Can we sell firearms?”). Police called on their non-emergency number will generally dispatch a patrol car to pick the weapons up.
That is not a problem. The law imposes a duty on storage operators to not sell protected property of which the operator has actual knowledge. You could have such knowledge one of two ways:
• You could see it in the unit prior to sale (see: “When should we cut the lock?”), or
• The tenant could have disclosed the presence of the protected property in their unit (see: “How must my lease be changed to account for protected property?”).
The storage operator is doubly protected because a buyer at a storage auction cannot buy protected property (see: “Can an auction buyer buy protected property?”).
• You could see it in the unit prior to sale (see: “When should we cut the lock?”), or
• The tenant could have disclosed the presence of the protected property in their unit (see: “How must my lease be changed to account for protected property?”).
The storage operator is doubly protected because a buyer at a storage auction cannot buy protected property (see: “Can an auction buyer buy protected property?”).
No.
Arizona law prohibits a buyer from purchasing protected property that may be found in a sale unit at a self-storage facility. What’s more, the buyer has a duty to turn such materials over to the storage operator when and if they are discovered.
It is therefore a good idea to post a notice to auction buyers regarding this limit on their buying power. (See AZSA forms for a downloadable notice.)
Arizona law prohibits a buyer from purchasing protected property that may be found in a sale unit at a self-storage facility. What’s more, the buyer has a duty to turn such materials over to the storage operator when and if they are discovered.
It is therefore a good idea to post a notice to auction buyers regarding this limit on their buying power. (See AZSA forms for a downloadable notice.)
As of July, 2010, all self-storage leases must contain an opportunity for the tenant to disclose that protected property is or will be stored in their unit.
Further, of the four notices that are mandated in all storage leases in not less than 10-point bold print, the notice that property may be sold in the event of a default should be changed to indicate that property may be sold or otherwise disposed of in the event of a default. Similarly, the statutory sign posted in all self-storage offices must similarly reflect that property may be sold or otherwise disposed of in the event of a default.
(See: AZSA forms for an addendum that can be used in conjunction with existing leases until conforming leases can be printed, and a conforming sign that can be downloaded and used.)
Further, of the four notices that are mandated in all storage leases in not less than 10-point bold print, the notice that property may be sold in the event of a default should be changed to indicate that property may be sold or otherwise disposed of in the event of a default. Similarly, the statutory sign posted in all self-storage offices must similarly reflect that property may be sold or otherwise disposed of in the event of a default.
(See: AZSA forms for an addendum that can be used in conjunction with existing leases until conforming leases can be printed, and a conforming sign that can be downloaded and used.)