The immensely popular television show, Storage Wars is now making its mark in Canada. While the show’s producers move into high gear to get filming off the ground, storage facility owners are looking to their US cou1nterparts, and to the Canadian Self Storage Association for guidance.
There are two very opposing thoughts on the show and its impact on the storage business. While some feel it is a tremendous marketing tool and conduit for industry awareness, other feel it is rife with potential lawsuits and legal ramifications.
Although the Canadian Self Storage Association does not take an official stance on the show, it is important for owners and operators to arm themselves with information before partaking in this media frenzy in order to make an informed decision on participation.
It is important for operators to remember that selling goods is a very small aspect of our business. Wise operators will not allow themselves to get caught up in the glamour of reality television and approach participation in the show purely as a business transaction.
Legal Awareness
There is no law in Canada that specifically governs the seizure and sale of goods for nonpayment of rent for storage operators. Many US states have adopted specific legislation that clearly defines the process for the sale of goods to recover rent. In Canada, operators rely on Provincial legislation that addresses the issue on a broad scale, but is largely open to interpretation.
Operators throughout the country have different forms of agreements or leases that outline the rules and terms of rental between tenant and owner. All operators are encouraged to consult with a lawyer before implementing any lease agreement at their property. The CSSA is able to provide guidance by way of recommended best practices to assist in the lease creation process.
All operators should have some form of documentation that clearly outlines the facility’s ability to seize and sell goods for unpaid accounts. Reference should be made to the legal remedy used to dispose of goods, whether it is a reference to industry best practices, or to the closest applicable legislation as determined by the operator (ie. in Ontario goods are often disposed of under the Repair and Storage Liens Act).
In terms of the show, operators must consider the potentially damaging evidence created by a publicized sale. In the event of a possible wrongful sale suit against an owner, a publicized, videotaped version of the sale might be providing the claimant with enough evidence to win a case; and perhaps with an appraised value on some very specific items.
An operator that decides to partake in the show should ensure that the agreement between the owner and the show’s producers has language in place to ensure all sales are conducted legally, and within the parameters of the facility lease. There must also be a mechanism for the facility operator to approve the process before it becomes the property of the producers.
Public Impression
While there is a romantic side to lien sales, with hopes of finding a treasure buried deep within a storage unit, there is an equally sinister side. The general public may feel like Storage Wars is merely highlighting modern day treasure hunting. That impression however, can quickly change when they become a tenant. Questions around what happens to their goods should they miss a payment take center stage.
There must be protection in the show agreement that governs what the producers may air. Confidential items, personal information, illegal items that may be found, logo related items, etc. What may provide for great reality television may not be the impression operators want their prospective tenants formulating about their facility. Picture the impact of a business associated with a unit containing explosives, or a rat-infested mattress.
In some cases operators may want the publicity that comes with the show; the use of the corporate logo to bolster business. Operators will want to negotiate the parameters of the use of their logo. Facility owners must control the use of the corporate logos, trademarks and identifiers. The producers will want to negotiate rights to use all recorded information, good or bad, in perpetuity and in multiple media formats. This could result in a facility’s trademark name used 10 years after the show has ended on disparaging or non reputable internet site. Careful consideration to language in the agreement will prevent long term reputation damage.
In other cases, operators may want to participate without the use of their corporate logo or trademarks. Protections must be put in place to ensure that the agreement is followed, and a recourse mechanism is in place for non compliance.
Logistics
Many storage facilities have been affected by the original airing of Storage Wars in the US. Auctions command a larger audience, and crowd control can sometimes be an issue.
The ability for operators to control auction day activities and still maintain operations is critical. Increased staffing, the possible addition of security and facility clean up are real costs that could be incurred by operators if crowds grow larger. Compensation should be considered for these expenses.
The ability for the show’s producers to attend the site both before and after the auction should be considered. Having a television crew and equipment on site for multiple days can be a disruption to any business. With parking as premium for many operators, limitations on equipment and personnel should be discussed when negotiating an agreement.
Facility owners will want to ensure that the show schedule corresponds to the schedule of business at the facility. Consider the impact of having auctions rescheduled, or having film crews present on location after operating hours.
Other Considerations
Owners must ensure that the show personnel on site have adequate insurance coverage. Workers Compensation Insurance (in Ontario) is undoubtedly required. Additional insurance considerations would include a General Liability policy with the owners named as a specific additional insured, as well as automobile insurance. Minimum coverage should be adequate to cover all possible outcomes. Consultation with an insurance professional is recommended.
Compensation for a show of this nature should be commensurate with the risk, inconvenience and perceived benefits. Although the amount of compensation for movies and TV shows varies greatly, it is believed that there should be an equitable balance between compensation for characters, cast and facilities.
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