Monday, October 18, 2010

Downside of Keeping Antiques in Storage for Five Years, Unmonitored

Sherry Boire treasured her household contents. In fact when she began suffering from what turned out to be a long-term disability, she placed it all into storage – where it remained for five years, at a monthly cost of initially $64.20. When Ms. Boire recovered and wished to re-establish her home, she removed her chattels from storage. Most, including furniture consisting of family heirlooms and a number of antique barber chairs, had sustained significant damage as a result of moisture and mice: mold-discoloured wood, corroded metal, and furniture damaged by rodent chewing, urination and droppings.

In the 2009, Saskatchewan case of Sherry Boire v. Eagle Lake Enterprises Ltd. and Paul Florizone o/a Delta Sales, Ms. Boire sued the initial and the subsequent owner of the storage facility for her losses, over $35,000.

The Facts:

Before placing her belongings into storage, Ms. Boire met with Mr. Florizone, first owner of the facility, for a building tour and discussion. Mr. Florizone assured her that the newly-constructed building had temperature control, was air and water tight, pallets were not necessary, and that it would be like storing goods in her own home.

There was no written contract, but on the receipt Mr. Florizone wrote “all items left at owner’s risk.” Ms. Boire believed that this meant that she had to have insurance. She did, but there were exclusionary clauses relating to water and other damage, so her insurance did not cover the loss.

Mr. Florizone told Ms. Boire that to enter the building she would need to contact management, and to access her unit she would have to provide her own lock and key. Since he would not have a key to her locker, and therefore no access, she would have to look after the contents.

Mr. Florizone effectively approved of the manner in which Ms. Boire stored her goods. She even placed five pounds poisoned oats for rodent control.

When the plaintiff returned almost five years later, she encountered the damage. However none of the more than 100 other locker – renters, with virtually identical units, had a problem. The facility had been properly heated and kept clean and dry, and was secure. But the people who helped move Ms. Boire out of her unit noted a hairline crack in the floor, powdery mildew halfway up the walls and signs of rodents.

The Issues:

The court was charged with determining six issues:
  • Were the plaintiff’s goods damaged while in the defendants’ building?
  • If so, what caused the damage?
  • Were the defendants liable in bailment, negligence, or breach of contract?
  • Did “left at owner’s risk” on the receipt absolve the defendants of responsibility?
  • What was the quantum of damages and how should it be apportioned?
  • Did the plaintiff contribute to the loss by her own negligence or by failing to take steps to reduce the loss?

When someone leaves property in the possession of another, a bailment may be created. Two fundamental conditions of bailment are that ownership is not transferred, and the property is to be returned in the expected condition upon reasonable notice. If a bailment exists, who has to prove what, initially, changes. In this case we would begin with the premise that the defendants are returning the goods not as first stored, meaning they would be obliged to shift the blame to the plaintiff.

The Position of Ms. Boire:

Ms. Boire claimed that a bailment existed. In the alternative, she argued that the defendants were negligent in their care of her chattels, or they breached an implied term of the contract, that management would look after her goods. Without bailment, she would have to prove negligence or that there was an implied term of the contract (caring for her goods) that was breached. She alleged that she was blameless, having received all assurances from Mr. Florizone. Therefore his notation “left at owner’s risk” was irrelevant.

The Position of the Defendants:

Mr. Florizone and the subsequent owner of the facility, Eagle Lake Enterprises Ltd., argued that:
  • No bailment existed since Ms. Boire had exclusive access to her locker and therefore the defendants did not have full possession of the contents.
  • The defendants were not negligent nor did they breach the terms of the contract. They provided a secure, clear, dry storage unit, and in fact also placed antifreeze and traps to avoid rodents. There were never any other problems with damage over the entire five years, to the property of others.
  • Ms. Boire must have allowed damp items into the unit, packed too tightly, or was otherwise negligent; if not entirely, then partially.
  • Ms. Boire did not prove the condition of the chattels when she first stored them.
  • Damage may have occurred during or after removal from storage.
The Court's Decision:

The court found that Ms. Boire’s belongings arrived at the storage unit in good condition, and that all was packed properly, with due care. That was her nature. She had a well-kept home and contents.

There was no definite answer as to how the damage occurred, but it did happen while the contents were in storage. It likely accumulated over time. The property of other tenants was not damaged because it was not stored long enough.

Because only Ms. Boire had access to her unit, the relationship was not a bailment. However, the defendants owed her a duty of care. The “left at owner’s risk” did not absolve them of responsibility, for two reasons: it was reasonable for Ms. Boire to understand that the phrase meant she was responsible for insurance, and she did have coverage, albeit insufficient; and it was clear that optimum storage conditions were critical to Ms. Boire, constituting an implied in the contract. The defendants breached it.

The defendants’ duty of care meant they were required to keep the surrounding environment safe. Ms. Boire relied on the defendants for an assurance that her goods would not be damaged by anything that could affect the safety of the unit. Mr. Florizone assured that leaving the goods in his premises would be the same as storing them in her own home. And of course in one’s well-kept home this would include ensuring a rodent-free environment and monitoring for moisture and water seepage. The defendants were negligent on both counts. Furthermore, they failed to alert Ms. Boire to the possibility of rodent and moisture problems.

But in this “dual control” storage arrangement, Ms. Boire had responsibilities since she alone had access to her unit. Mr. Florizone cautioned her that she had to look after her property. If she had stored the goods in her own home over that period of time and acted in a prudent manner, periodically she would have inspected them, or in failing health instructed someone else to do so. Inspections might have uncovered the damage in time to prevent it from progressing.

While approximately $35,000 in damage was proven, since the case was argued in small claims court the maximum recoverable was $20,000. A $20,000 judgment was entered. But Ms. Boire was found 50% negligent, so she was awarded only $10,000. The defendants were jointly and severally responsible for the other 50% of the loss.

The Moral of the Story:

As is often the case, there are lessons to be learned:
  • Periodically monitor goods in storage
  • Considering giving management a key, if permitted
  • Consider purchasing supplementary coverage which insures against all losses
  • While in this case the waiver of liability was deemed inconsequential, if you can, quality in writing whatever you agree to
  • If after discussion with counsel you think you have an excellent case, ponder proceeding in a higher court.
If Ms. Boire had considered the foregoing, either she wouldn’t have had the problem, or if so perhaps she would have ended up with a $35,000 judgment, plus costs.

- Alvin Starkman, Oaxaca, Mexico

Alvin Starkman received his Masters in Social Anthropology in 1978. After teaching for a few years he attended Osgoode Hall Law School, thereafter embarking upon a successful career as a litigator until 2004. Alvin, a good-standing member of the Law Society of Upper Canada, now resides with his wife Arlene in Oaxaca, Mexico, where he writes, leads small group tours to the villages, markets, ruins and other sights, is a consultant to documentary film production companies, and operates Casa Machaya Oaxaca Bed & Breakfast.


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