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84-7-209. Lien of warehouse. (a) A warehouse has a lien against the bailor on the goods covered by a warehouse receipt or storage agreement or on the proceeds thereof in its possession for charges for storage or transportation, including demurrage and terminal charges, insurance, labor, or other charges, present or future, in relation to the goods, and for expenses necessary for preservation of the goods or reasonably incurred in their sale pursuant to law. If the person on whose account the goods are held is liable for similar charges or expenses in relation to other goods whenever deposited and it is stated in the warehouse receipt or storage agreement that a lien is claimed for charges and expenses in relation to other goods, the warehouse also has a lien against the goods covered by the warehouse receipt or storage agreement or on the proceeds thereof in its possession for those charges and expenses, whether or not the other goods have been delivered by the warehouse. However, as against a person to which a negotiable warehouse receipt is duly negotiated, a warehouse's lien is limited to charges in an amount or at a rate specified in the warehouse receipt or, if no charges are so specified, to a reasonable charge for storage of the specific goods covered by the receipt subsequent to the date of the receipt.

(b) A warehouse may also reserve a security interest against the bailor for the maximum amount specified on the receipt for charges other than those specified in subsection (a), such as for money advanced and interest. The security interest is governed by article 9.

(c) A warehouse's lien for charges and expenses under subsection (a) or a security interest under subsection (b) is also effective against any person that so entrusted the bailor with possession of the goods that a pledge of them by the bailor to a good-faith purchaser for value would have been valid. However, the lien or security interest is not effective against a person that before issuance of a document of title had a legal interest or a perfected security interest in the goods and that did not:

(1) Deliver or entrust the goods or any document of title covering the goods to the bailor or the bailor's nominee with:

(A) Actual or apparent authority to ship, store, or sell;

(B) power to obtain delivery under K.S.A. 2023 Supp. 84-7-403, and amendments thereto; or

(C) power of disposition under K.S.A. 2023 Supp. 84-7-403*, and amendments thereto, or K.S.A. 84-2a-304(2), 84-2a-305(2), 84-9-320, or 84-9-321(c), and amendments thereto, or other statute or rule of law; or

(2) acquiesce in the procurement by the bailor or its nominee of any document.

(d) A warehouse's lien on household goods for charges and expenses in relation to the goods under subsection (a) is also effective against all persons if the depositor was the legal possessor of the goods at the time of deposit. In this subsection, "household goods" means furniture, furnishings, or personal effects used by the depositor in a dwelling.

(e) A warehouse loses its lien on any goods that it voluntarily delivers or unjustifiably refuses to deliver.

History: L. 2007, ch. 90, § 15; July 1, 2008.

KANSAS COMMENT, 1996

Subsection (1) states the warehouseman's statutory lien against the bailor on the goods covered by the warehouse receipt. See K.S.A. 34-266 for provisions regarding grain storage liens. This subsection is similar to the carrier's lien in 84-7-307; however, the carrier's lien is specific whereas the warehouseman's lien is general.

As against a holder of a negotiable warehouse receipt, the lien is limited to reasonable charges unless a specific amount is stated in the receipt. See also K.S.A. 34-269. The lien reaches other goods deposited with the warehouseman if it is so stated in the receipt. Compare K.S.A. 34-267, under which the lien reaches "all grain, whenever deposited," and all grain deposited by the debtor which has been entrusted to the debtor with authority to pledge it.

Subsection (2) permits the warehouseman to reserve a security interest in the goods up to a maximum amount specified in the receipt. This security interest is not statutory; rather it is consensual and is governed by Article 9. Therefore, the attachment, priority and enforcement of the security interest under this subsection is governed by Article 9 rather than 84-7-210.

Section 84-7-202(2)(i) appears to permit a statement in the receipt that advances have been made, even though the exact amount is unknown. However, under 84-7-209(2) the amount, or "maximum amount," would seem to be required to be stated. To be effective, the statement would have to read "not to exceed," or "not more than," or words of like import. The provision in 84-7-202(2)(i) should not override the provision of subsection (2) of this section, especially since the words "or security interest" in 84-7-202(2)(i) were added from former K.S.A. 82-102(i) to correspond to subsection (2) of this section. Compare K.S.A. 34-239(i). The language in 84-7-202(2)(i) permitting a general statement of the fact that advances have been made, without specifying an amount, probably should apply only to advances for which the warehouseman claims a lien, and not a security interest.

Paragraph (3)(a) is in substantial accord with former K.S.A. 82-128. When goods have been stolen and deposited in a warehouse by the thief, the warehouseman's lien or security interest is not valid as against the owner. However, if the owner entrusted the goods to the bailor or otherwise acquiesced in the bailor's actions, the warehouseman's lien is valid against the owner. See also K.S.A. 34-267. Compare 84-7-307(2), which extends the carrier's lien even to situations involving unsanctioned bailments unless the carrier had notice that the consignor lacked authority and, thus, gives greater protection to carriers than 84-7-209 gives to warehousemen.

The warehouseman's lien under paragraph (3)(a), however, is subordinate to a prior, perfected security interest, since the secured party is normally protected by 84-7-503. See 84-9-310 and K Furniture Co. v. Sanders Transfer & Storage Co., Inc., 532 S.W.2d 910 (Tenn. 1975). Paragraph (3)(b) was added in 1966, and creates an exception to paragraph (3)(a) by expressly giving the warehouseman priority over secured lenders of the depositor of household goods when the depositor is the lawful possessor. The question of whether a sheriff depositing the goods of an evicted tenant was a "lawful possessor" of the household goods was raised but not resolved in Owen v. Treadwell, 11 K.A.2d 127, 716 P.2d 585 (1986).

Subsection (4) continues the rule of former law that the warehouseman's lien under this section is possessory, and depends upon the continued lawful possession by the warehouseman. Unlike liens for material and services provided for in K.S.A. 58-201 and the liens provided for in K.S.A. 58-208, there is no provision for filing after surrender of possession. The rule in K.S.A. 34-268 also provides the lien on the goods is lost if possession of the goods is voluntarily surrendered or if the warehouseman unjustifiably refuses to deliver the goods.

Compare generally this section to the carrier's lien in 84-7-307.

Revisor's Note:

* Reference to 84-7-403 should be to 84-2-403.

Former section 84-7-209 repealed by L. 2007, ch. 90, § 78 and the number reassigned to the current text.

Law Review and Bar Journal References:

Survey of Kansas commercial law (1965-1969), 18 K.L.R. 388 (1970).

"Kansas's Unique Treatment of Agricultural Liens," Keith G. Meyer, 54 K.L.R. 1141 (2005).

CASE ANNOTATIONS

1. Cited; provisions of 84-7-210 (1) and (2) must be met to enforce statutory lien on household goods. Owen v. Treadwell, 11 Kan. App. 2d 127, 129, 132, 716 P.2d 585 (1986).

2. Third party may not extend warehouseman's lien to a judgment in favor of another judgment creditor. Connery v. Jones Storage & Moving, Inc., 27 Kan. App. 2d 55, 997 P.2d 745 (2000).

3. Notice of sale by warehouse man not in compliance with 84-7-210(b). Snider v. MidFirst Bank, 42 Kan. App. 2d 265, 211 P.3d 179 (2009).


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