Notice of Intent to Exercise Warehouse Lien by Auction Template

In plain language: Identifies the warehouse operator sending the notice, the depositor receiving it, and the date of the notice.

Common mistake: Addressing the notice to a contact person rather than the legal entity name on the storage agreement — this can invalidate the notice if the depositor challenges proper service.

In plain language: Identifies the specific storage agreement, warehouse receipt number, or account number under which the goods are held.

Common mistake: Omitting the receipt or agreement reference entirely, making it difficult to establish a direct link between the notice and the contractual obligation to pay.

In plain language: Describes the goods subject to the lien with enough specificity for the depositor to identify them — item type, quantity, lot number, or storage unit.

Common mistake: Using generic descriptions like 'various inventory' instead of specific identifiers. Vague descriptions weaken the enforceability of the lien and may trigger disputes over which goods are covered.

In plain language: Itemizes the total amount past due, including storage fees, handling fees, and any accrued late charges, with the calculation period.

Common mistake: Stating only a lump-sum total without itemizing how it was calculated — depositors frequently dispute amounts, and an unexplained total invites a challenge that delays the auction.

In plain language: Formally states that the warehouse operator intends to exercise its warehouse lien rights under applicable law and sell the goods by public auction.

Common mistake: Failing to cite the specific statute that grants lien rights. Without a statutory reference, the depositor cannot verify the legal basis for the sale and may successfully challenge the process.

In plain language: Specifies the scheduled auction date, time, and the physical or online location where the sale will take place.

Common mistake: Scheduling the auction before the statutory notice period has expired. Most jurisdictions require 10 to 30 days between notice and sale — confirm the applicable minimum before setting the date.

In plain language: Tells the depositor how to reclaim the goods by settling the full outstanding balance before the auction date.

Common mistake: Not specifying an accepted payment method or a clear redemption deadline. Ambiguity here lets a depositor claim they tried to pay but were unable to, potentially stalling the sale.

In plain language: Provides the name, title, phone number, and email of the warehouse representative to contact, and closes the letter with an authorized signature.

Common mistake: Listing a generic 'info@' email without a named contact. Depositors who cannot reach a specific person use this as a reason to dispute that they received adequate opportunity to respond.

A warehouse lien is a statutory right that allows a warehouse operator to retain possession of stored goods until the depositor pays all outstanding storage charges. If the depositor fails to pay, the lien gives the warehouse operator the right to sell the goods at public auction and apply the proceeds to the unpaid balance. The lien right exists under UCC Article 7 in the United States and equivalent statutes in other jurisdictions.

Send this notice after storage charges have gone unpaid past any grace period in your storage agreement and you have made reasonable attempts to collect the outstanding balance. The notice formally triggers the statutory process and starts the mandatory notice period before you can hold the auction. Sending it too early — before the account is genuinely delinquent — can expose you to a wrongful lien claim.

The required notice period varies by jurisdiction. Under UCC Article 7, the general requirement is that notice be given a reasonable time before the sale. Many state-specific warehousemen's lien statutes set explicit minimums ranging from 10 to 30 days. Always verify the current statutory requirement in the state where the goods are stored before scheduling the auction date.

Many state statutes require the notice to be sent by certified mail, return receipt requested, to create a documented proof of delivery. Some jurisdictions also permit personal service or, in limited cases, published notice if the depositor cannot be located. Check the specific service requirements of your applicable statute — email alone is typically insufficient unless the storage agreement explicitly authorizes it.

In most jurisdictions, any auction proceeds remaining after the full outstanding balance, auction costs, and related fees are paid must be returned to the depositor. Keeping surplus proceeds is generally prohibited and can expose the warehouse operator to liability. Some states require surplus funds to be held in escrow or paid into a court registry if the depositor cannot be located.

Yes. The depositor can prevent the auction at any time before the sale by paying the full outstanding balance plus any accrued costs. This is called redemption. Your notice should state a clear redemption deadline — typically 24 to 48 hours before the scheduled auction — and specify the accepted payment methods so there is no ambiguity about how to exercise that right.

No formal notarization or witness signature is required for this notice to be effective in most jurisdictions. However, it should be signed by an authorized representative of the warehouse operator to authenticate it. Keeping a signed copy in your records is essential if the depositor later disputes that the notice was properly issued or delivered.

Self-storage facilities typically operate under a separate self-storage lien statute rather than the commercial warehouse lien provisions of UCC Article 7. While the structure of a self-storage lien notice is similar, the required content, notice periods, and auction procedures often differ. Confirm the applicable statute for your facility type before using this template, and adapt the statutory citation and procedural details accordingly.