§ 41-02.1-38 — (2A-308) Special rights of creditors

North Dakota § 41-02.1-38

• Jurisdiction: North Dakota
• Title 41: Uniform Commercial Code
• Ch. 41-02.1: Leases

Text

1. A creditor of a lessor in possession of goods subject to a lease contract may treat the
lease contract as void if as against the creditor retention of possession by the lessor is
fraudulent under any statute or rule of law, but retention of possession in good faith
and current course of trade by the lessor for a commercially reasonable time after the
lease contract becomes enforceable is not fraudulent.
2. Nothing in this chapter impairs the rights of creditors of a lessor if the lease contract
becomes enforceable, not in current course of trade but in satisfaction of or as security

for a pre-existing claim for money, security, or the like, and the lease contract is made
under circumstances which under any statute or rule of law apart from this chapter
would constitute a fraudulent transfer or voidable preference.
3. A creditor of a seller may treat a sale or an identification of goods to contract for sale
as void if as against the creditor retention of possession by the seller is fraudulent
under any statute or rule of law, but retention of possession of the goods under a lease
contract entered into by the seller as lessee and the buyer as lessor in connection with
the sale or identification of the goods is not fraudulent if the buyer bought for value and
in good faith.