Legal Question in Bankruptcy in Utah

Abandon Personal Property

I signed a lease on a building for my business. The building has been vacant for 3 years. The previous tenant leased the building, filed for bankrupcty and went ''out-of-business.'' The tenant leased a pole sign (that was installed in the ground on the property) and wall sign cabinet (that was attached to the building) from a local sign company. The sign co. was named as a creditor in the bankruptcy. The debt was discharged. The sign co. did not remove the pole sign or the wall sign cabinet. They only removed the ''sign face'' (the face of the sign that reads the logo or business name) and the light bulbs. The pole sign and wall cabinet still remain after three years.

I would like to use the pole sign and wall sign cabinet for my business.

The landlord does not have a contract or lease with the sign co. The landlord gave his approval with my use of the signs.

The sign co. claims ownership of the signs. The sign co. states that I must lease the signs from them.

After three years, are the signs considered abandoned property since they were not removed at the time of the bankruptcy?

Do the signs become a part of the real property since they are installed?


Asked on 3/22/04, 7:58 pm

1 Answer from Attorneys
Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Abandon Personal Property

The sign company has abandoned the signs. They probably had a security interest in the signs with the former tenant, but their failure to either enter into an agreement with the landlord or to reclaim the signs constitutes abandonment of the signs. The had no inherent right to leave the signs on the landlord's property after the bankrupt tenant left, therefore they were abandoned. You should be able to use the pole and wall sign - with any sign company refurbishing the signs as needed. Make sure the next sign company does not use language which results in them having a claim to the pole and wall cabinet - they would be entitled to only claim materials they install. If you purchase new parts, then they belong to you and/or the landlord. (Depending on the lease terms.)

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Answered on 3/23/04, 11:08 am


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