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Legal Help Desk
DEAR LEGAL HELP DESK
QA Storer has requested to have their storage fees reduced because they cannot access their goods, due to COVID-19. Do I have to do this?
A(Australian Members):
The storage relationship is governed by the storage agreement (and of course other laws).
The storage agreement makes it clear that the only service provided by the facility is a licence to use the space provided for the sole purpose of storing goods and no other services are provided. Here you are continuing to allow the storage of goods – being the service you agreed to provide storage fees. Members would want to avoid a complaint to the Commerce Commission that might lead to the Commerce Commission considering how much facilities can charge over the lockdown period. We are of the view that each facility should consider each request from storers on a case-by-case basis and consider what is fair. These are unprecedented times and there is at least a moral imperative to support storers who may be facing hard times. In the absence of any applicable rules, the Association and members may wish to consider for themselves what is a fair and reasonable position to take during the lockdown, and whether storers ought to have some form of
A(NZ Members): voluntary reduction. At the very least The storage relationship is it would seem to be the best approach governed by the storage agreement to show empathy towards storers (and of course other laws). The storage and those in financial difficulties. The agreement does not provide for any Association and members may wish to reduction in fees or similar during a consider how to deal with those who no access period such as in a find themselves in the hard times that pandemic. The storage agreement are forecast for many people. makes it clear that the only service provided by facility is a licence to use the space provided for the sole purpose of storing goods and no other services are provided. Here you are continuing to allow for the storage of goods – being the service you agreed to provide. Storers have been temporarily denied access by the restrictions imposed by the government but they are still getting storage.
The position might be different if a storer has genuinely reached the end of its term and wanted to remove goods from storage – as the storer would otherwise not have continued incurring
QWe are seeking assistance with the announcement on 29/3/2020 relating the Tenancy Relief Principles.
A(Australian Members):
This announcement relates to commercial and residential leases. The SSAA storage agreements do not grant storers a lease of the space. The only service provided by a storage business is the facilitation of the storage of goods by the storer in the space. Therefore, our position remains that it does not apply to self storage. Members will need to develop their own procedures and deal with requests from storers who are unable to pay their storage fees. Each request will need to be assessed on a case-by-case basis, keeping in mind the tough times we all find ourselves in now.
A(NZ Members):
As at 24 April 2020, the NZ Government has not provided any relief for commercial leases. However, if the Government does introduce such relief, it would not apply to storage agreements as they are licences, not leases (so the position is the same as that in Australia). Our comments above also apply here.
QWe’d like to reach out for your opinion on selling secondhand boxes. We’re focused on being environmentally responsible and would like to consider the life cycle of our products and potentially offer our customers the opportunity to buy used boxes as well as sell their boxes back to us for resale.
A(Australian Members):
The Facility can sell secondhand storage boxes, however like selling any goods, your facility needs to comply with various requirements under the Australian Consumer Law.
First, your facility needs to disclose to the potential buyers that the storage boxes have been used.
Secondly, your facility must make sure the boxes are still of sound quality, by ensuring that the boxes: l are of acceptable quality;
l are fit for any disclosed purpose; l if supplied by description, match the description given to the consumer; and l if supplied based on a sample or demonstration model, correspond with the quality, state or condition of the sample or demonstration model and are free from any defects not apparent in the sample or model.
The risk of not complying with the above requirements is that your facility is likely responsible for any loss and damage caused. For example, if a used box sold by your facility cracks in the middle of being used to carry other goods and causes damage to carried goods, your facility is likely to be required to compensate the damages.
Under the Australian Consumer Law, there is no fixed set of criteria to assess whether the goods sold are of acceptable quality or fit for any disclosed purpose. The test is more based on the knowledge and level of sophistication of the consumer.
In order to minimise your risk, we recommend the Facility: l thoroughly check every storage box to be sold; l removes and does not sell any storage box that appears faulty; and l uses reasonable signage and verbal advice to ensure any consumer is aware that the products are second hand. much you charge for them, what you tell consumers about them and the general condition of the boxes.
As with new boxes, if the used boxes are faulty, you will be required to replace, repair or refund the consumer (at their option). You may also have to pay them damages for any reasonable costs they incurred because of the fault.
A(NZ Members):
Your consumer law obligations when selling used boxes in NZ are the same as when you sell new boxes, the only difference is consumers cannot expect the same quality as new boxes. So, all used boxes that you sell need to: l be fit for purpose l be safe l be free from defects l look acceptable l last for a reasonable amount of time.
Whether the used boxes are of acceptable quality depends on how
QHow long do agreements need to be kept?
A(Australian Members):
We recommend that you retain copies of storage agreements for 7 years after termination. Generally, a Storers’ personal information, which is contained in storage agreements, is not permitted to be stored if it is no longer required for the purposes for which it was collected by the Facility. Retaining agreements may, however, be required for the following reasons; l where the Facility uses agreements for tax purposes, it needs to store them for 5 years; or l where the Facility uses agreements to verify financial statements, it needs to store them for 7 years.
Further, a Storer may commence legal proceedings for a breach of contract 6 years from the date of the alleged breach. If this were to happen, the Facility may need to rely on the terms of the agreement. While the Facility may have separate invoices that it uses for tax purposes and to verify financial statements, the combination of the above reasons makes it prudent to retain the agreements for 7 years. Again, this can be as hard or soft copies. for up to 6 years after the date of the breach. You should therefore keep copies of agreements for at least 7 years after the agreement has terminated, to support any tax queries of claims for breach of contract you may receive.
However, it is also important to remember that under privacy law, you can only hold personal information about storers (i.e. names, contact details, ID details) for as long as is required for the purpose that you collected it for. So, while you can keep copies of the storage agreements, any personal information you keep can only be kept and used in relation to tax or legal claims you may receive. You should delete any personal information from storers from contact and marketing databases etc.
A(NZ Members):
A similar position applies in NZ. NZ tax law requires you to keep records in relation to business matters for 7 years for tax purposes. Facilities and storers can also bring claims against each other for a breach of contract
A(Australian Members):
There is no prescribed method to manage or store agreements, however it is important that the Facility protects private information to avoid being in breach of the Australian Privacy Principles (APP). The Facility should have a system to prevent misuse, loss or unauthorised access to Storers’ personal information. The Facility should implement its own procedures to ensure security.
A(NZ Members):
The same position applies in NZ. You can manage or store agreements however you like, but you need to ensure that it is stored securely in accordance with NZ privacy law. This means you must ensure all agreements and personal information is protected by security safeguards that are reasonable for the circumstances to protect against loss, unauthorised use or disclosure, or other misuse. l
Disclaimer: The information contained in these answers is of a general nature and is not intended as legal advice. It is important that you seek legal advice that is specific to your circumstances. Please refer to the SSAA’s website for more information on the SSAA’s Legal Help Desk.
