Security

Mini- Storage Messenger - Security

QUESTION: This month’s question is from a manager who relates that the entry gate at the facility where she is employed has broken, the original people who installed the gate appear not to be in business any more and she is having trouble locating parts and/or someone who understands the inner workings of the gate in order to service it. So for now, the gate is left open during gate access hours and closed manually at night. Many of her occupants are upset because they felt that an automatic gate is part of the “security package” that they paid for when signing the rental agreement. Some of the 24 hour access tenants are upset because they no longer have 24 hour access. So the question then is: Do I have to provide all of the security services that were in place at the time each of these occupants leased from me? If not how do I terminate the service?

Answer: The answer to that question depends greatly on the language in your rental agreement. The rental agreement normally states that someone is renting a particular piece of real estate, i.e. a storage unit or outdoor vehicle storage space, for the purpose of self-service storage. Generally, the rental agreement does not provide that included with the rental is an automatic gate, video cameras, etc. These are, in my view, amenities that you are providing for the facility ancillary to the actual rental of space.

In the best of all possible worlds, your rental agreement should have provided that security features or other amenities may break or may not be available at all times and that this does not constitute a breach of the rental agreement. If you have this provision, you probably would not have sent in this question. Working from the assumption that you do not have a lease provision that completely excuses you from the allegation of default, we must look at whether or not you have promised or offered these features as a part of the rental and whether the occupants are entitled to rely on the existence of these amenities in exchange for rent.

At the outset, however, most self storage rental agreements are month-to-month agreements. Any occupant who is truly unhappy or feels less than secure could, in theory, vacate prior to the beginning of the next calendar month and move to another self storage facility. Naturally, I am not trying to chase away business however, you can only do so much when you gate contractor has disappeared and for you may be under ownership constraints about buying a new gate or entering into a contract with another company to service the gate. For those occupants who chose to remain, it is my position that they cannot “demand” a gate because, as stated above, these are month-to-month contracts. If you put up a notice that the gate will be out of order until some period of time or indefinitely and occupants continue to pay their rent they are impliedly accepting a change in the terms of the contract next month to a facility without an automatic gate. This issue is of course more difficult for those who have contracted for 24 hour access and you are now denying the ability to get in at all hours. These people may be entitled to some rent abatement at least for the month if they are paying for 24 hour access and you did not put up notice of the change in gate policies. You should obviously stop charging any premium for 24 hour access if it is going to be impossible for you to get the gate operating any time in the near future.

The key in this situation is open communication; let your occupants know what the expectations are for the future of the gate, whether or not it will be replaced soon, why there is a hold up in the gate repair or replacement, or whether there will ever be a working auto gate in the foreseeable future. Most of your occupants will adapt. Those who think they are entitled to a rent decrease may choose to leave; those who insist on 24 hour access are going to have to leave. But, that will be a decision made by you and your ownership in light of their response. At the end of the day security features are an amenity. I would argue it is an important amenity, like a working bathroom, but not required for occupancy. If you have amenities and a month-to-month contract, amenities are generally cancelable subject to notice from you. You may also want to add in your rental agreement in the future the provisions that allow for breakdown or removal of amenities without it being considered a default or breach or getting an offset in rent, though that will not help today. Your occupants will speak with their mouth and their wallets whether or not they approve of the removal of an amenity, but really at the end of the day you have probably not breached the rental agreement/contract and probably do not owe people rent rebates particularly since when the new month began and the new renewal of the rental agreement/contract began, people must have known that the gate was not working and they did not choose to terminate their occupancy.

You can send your questions, comments, or suggestions for future topics to Jeffrey Greenberger at info@selfstoragelegal.com or mail them to Jeffrey Greenberger c/o Katz Greenberger & Norton LLP, 105 E. Fourth Street, Suite 400, Cincinnati, Ohio 45202 or you can reach Mr. Greenberger at (513) 721-5151, or visit his website at www.selfstoragelegal.com.