§ 41-02.1-42 — (2A-401) Insecurity - Adequate assurance of performance

North Dakota § 41-02.1-42

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

Text

1. A lease contract imposes an obligation on each party that the other's expectation of
receiving due performance will not be impaired.
2. If reasonable grounds for insecurity arise with respect to the performance of either
party, the insecure party may demand in writing adequate assurance of due
performance. Until the insecure party receives that assurance, if commercially
reasonable the insecure party may suspend any performance for which the insecure
party has not already received the agreed return.
3. A repudiation of the lease contract occurs if assurance of due performance adequate
under the circumstances of the particular case is not provided to the insecure party
within a reasonable time, not to exceed thirty days after receipt of a demand by the
other party.
4. Between merchants, the reasonableness of grounds for insecurity and the adequacy
of any assurance offered must be determined according to commercial standards.
5. Acceptance of any nonconforming delivery or payment does not prejudice the
aggrieved party's right to demand adequate assurance of future performance.