§ 331 — Definitions

§ 331. Definitions. In this article, unless the context or subject\nmatter otherwise requires:\n 1. "Motor vehicle" or "vehicle" means any device propelled or drawn by\nany power other than muscular power, upon or by which any person or\nproperty is or may be transported or drawn upon a public highway, road\nor street. The term does not include a "snowmobile" as defined in\nsubdivision three of section 21.05 of the parks, recreation and historic\npreservation law or other vehicles not designed primarily for highway\ntransportation, but which may incidentally transport persons or property\non a public highway.\n 2. "Retail lessee" or "lessee" means a natural person who leases a\nmotor vehicle from a retail lessor primarily for personal, family or\nhousehold use and who executes a retail lease agreement in connection\ntherewith. For purposes of section three hundred thirty-four and\nsubdivisions two and three of section three hundred forty-six of this\narticle, the term also includes a person who makes a payment to a lessor\nor leaves his vehicle with a lessor pending the execution of a retail\nlease agreement. Except as provided in sections three hundred\nforty-eight and three hundred forty-nine of this article, the term does\nnot include a person who leases a motor vehicle primarily for\nagricultural, business or commercial use or for the purpose of\nsubleasing.\n 3. "Retail lessor" or "lessor" means a person regularly engaged in the\nbusiness of leasing or selling motor vehicles who leases a motor vehicle\nto a retail lessee under or subject to a retail lease agreement.\n 4. "Retail lease" or "lease" means a transfer from a retail lessor to\na retail lessee of the right to possession and use of a motor vehicle in\nreturn for consideration. The term does not include a sale, including a\nsale on approval or a sale or return, a retail instalment sale as\ndefined in article nine of this chapter or the retention or creation of\na security interest in a motor vehicle.\n 5. "Retail lease agreement" or "agreement" means an agreement, entered\ninto in this state, for the lease of a motor vehicle, and which may\ninclude the purchase of goods or services incidental thereto, by a\nretail lessee for a scheduled term exceeding four months, whether or not\nthe lessee has the option to purchase or otherwise become the owner of\nthe vehicle at the expiration of the agreement. The term includes such\nan agreement wherever entered into if executed by the lessee in this\nstate and if solicited in person by a person acting on his own behalf or\nthat of the lessor. The term does not include a retail instalment\ncontract or a rental-purchase agreement as defined in articles nine and\neleven of this chapter. An agreement that substantially complies with\nthis article does not create a security interest in a motor vehicle as\nthe term "security interest" is defined in paragraph thirty-five of\nsubsection (b) of section 1--201 of the uniform commercial code.\n 6. "Additional early termination charge" means the initial dollar\namount of the early termination charge the portion of which is\nrecoverable by the holder upon early termination in addition to the\namounts specified in paragraphs (a) through (e) of subdivision one of\nsection three hundred forty-one of this article. The additional early\ntermination charge may only include amounts which are reasonable in\nlight of the anticipated or actual harm caused by the delinquency,\ndefault or early termination, the difficulties of proof of loss and the\ninconvenience or nonfeasibility of otherwise obtaining an adequate\nremedy. Any fees or charges included in the additional early termination\ncharge may not also be included in the capitalized cost.\n * 7. "Initial early termination charge" means the sum of the adjusted\ninitial lease value and the additional early termination charge, which\nwould be recoverable under the lease agreement if the agreement were to\nbe terminated before any of the periodic rental payments had become due.\nThe term does not include any vehicle disposition fee or any other\ncomponents of a lessee's early termination liability which could not\nhave been incurred by the lessee at lease inception.\n * NB There are 2 sb 7's\n * 7. "Adjusted capitalized cost" means the capitalized cost less any\ncapitalized cost reduction payments made by the lessee at the inception\nof the lease and any net trade-in allowance granted by the lessor.\n * NB There are 2 sb 7's\n 8. "Anticipated assignee" means the person to whom the lessor\nanticipates that the agreement will be assigned and to whom the\nagreement subsequently is assigned by the lessor.\n 9. "Base rental payment" means that portion of the monthly or other\nperiodic rental payment which is equal to the sum of: (a) the average\nmonthly or other periodic lease charge; and (b) the average monthly or\nother periodic depreciation. For purposes of this article, the average\nmonthly or other periodic depreciation may include a monthly or other\nperiodic charge for any item that the lessor has included in the\ncapitalized cost.\n 10. "Conspicuous" means that a term or clause is so written that a\nreasonable person against whom it is to operate ought to have noticed\nit. Whether or not a term or clause is conspicuous is a question of law\nfor decision by the court.\n 11. "Capitalized cost" means the agreed upon amount which serves as\nthe basis for determining the base rental payment and a portion of the\nearly termination liability of the lessee. The capitalized cost may\ninclude any taxes, registration, license acquisition, assignment and\nother fees and charges for insurance, for a waiver of the contractual\nobligation to pay the gap amount, for accessories and their\ninstallation, for delivering, servicing, repairing or improving the\nmotor vehicle and for other services incidental to the agreement. It\nalso may include the unpaid balance of any amount financed under an\noutstanding motor vehicle loan agreement or motor vehicle retail\ninstalment contract or the unpaid portion of the early termination\nobligation under an outstanding motor vehicle retail lease agreement.\nThe term does not include any lease charge or any amount included in the\nadditional early termination charge.\n 12. "Capitalized cost reduction" means any payments made by cash,\ncheck or similar means that are in the nature of downpayments made by\nthe lessee at the inception of the lease for the purpose of reducing the\ncapitalized cost.\n 13. "Constant yield method" means: (a) in the case of a periodic\npayment lease, that method of determining the lease charge portion of\neach base rental payment pursuant to which the lease charge for each\ncomputational period is earned in advance by multiplying the constant\nrate implicit in the lease times the balance subject to lease charge as\nit declines during the lease term. At any given time during the\nscheduled term of a periodic payment lease, the balance subject to lease\ncharge is the difference between the adjusted capitalized cost and the\nsum of: (i) all depreciation amounts accrued during the preceding\ncomputational periods; and (ii) the first base rental payment; (b) in\nthe case of a single or advance payment lease, that method of\ndetermining the periodic earning of lease charges pursuant to which the\nlease charge for each computational period is earned in advance by\nmultiplying the constant rate implicit in the lease times the balance\nsubject to lease charge as it increases during the scheduled lease term.\nAt any given time during the scheduled term of a single or advance\npayment lease, the balance subject to lease charge is determined by\nsubtracting from the estimated residual value the total lease charge\nscheduled to be earned over the term of the lease and adding to the\ndifference all lease charges accrued during the preceding computational\nperiods; (c) in the case of either type of lease, the periodic lease\ncharge calculations are based on the assumption that the holder will\nreceive the rental payments on their exact due dates and that the lease\ngoes to its full term.\n 14. "Estimated residual value" means the estimated value of the leased\nvehicle at the scheduled end of the lease term, used by the lessor in\ndetermining the base rental payment, as established by the lessor at the\ntime he enters into a retail lease agreement.\n 15. "Gap amount" has the meaning ascribed to it in paragraph fifty-two\nof subsection (a) of section one hundred seven of the insurance law.\n 16. "Gap insurance" has the meaning ascribed to it in paragraph\ntwenty-six of subsection (a) of section one thousand one hundred\nthirteen of the insurance law. For purposes of paragraphs (a) and (b) of\nsubdivision six of section three hundred thirty-seven of this article,\ngap insurance shall not be deemed "liability insurance or insurance on\nthe vehicle".\n 17. "Group credit insurance" means group credit life insurance, group\ncredit accident insurance, group credit health insurance, group credit\naccident and health insurance or group credit unemployment insurance.\n 18. "Holder" means the retail lessor of a motor vehicle under or\nsubject to a retail lease agreement or, if the agreement is purchased by\nan assignee, the assignee. Unless and until it realizes upon its\nsecurity interest therein, the term does not include a pledgee of one or\nmore lease agreements to secure a bona fide loan thereon.\n 19. "Lease charge" means the charge to be paid by the retail lessee\nfor the privilege of making the rental payments as scheduled under a\nretail lease agreement. The term does not include any amount included in\nthe capitalized cost. The term also does not include any delinquency,\ndefault, disposition, early termination, collection, or reinstatement\ncharge and the amount, if any, included in a retail lease agreement for\ntaxes, registration, license acquisition, assignment and other fees and\ncharges for insurance, for accessories and their installation, for\ndelivering, servicing, repairing or improving the motor vehicle and for\nother services incidental to the agreement, whether or not such amounts\nare included in the capitalized cost, paid for separately at lease\ninception by cash, check or similar means or paid for on a monthly or\nother periodic basis in addition to the base rental payment.\n 20. "Person" means an individual, partnership, corporation,\nassociation or other group, however organized.\n 21. "Precomputed lease transaction" means a retail lease transaction\nin which the base rental obligation is a sum comprising the total\ndepreciation estimated to occur during the scheduled term of the lease\nand the amount of the lease charge computed in advance. A disclosure\nrequired by the act of Congress entitled "Consumer Leasing Act of 1976"\ndoes not in itself make a lease charge or transaction precomputed.\n 22. "Realized value" means: (a) the price received by the holder for\nthe leased vehicle at disposition; (b) the highest offer received by the\nholder for disposition of the leased vehicle; or (c) the fair market\nvalue of the vehicle, determined pursuant to subdivision one of section\nthree hundred forty of this article by a mutually acceptable independent\nappraiser, at the scheduled end of the lease term or, if the lease is\nterminated prior thereto, at early termination. The realized value of\nthe vehicle may be its value in the customary wholesale market.\n 23. "Renegotiation" means the satisfaction of an existing retail lease\nagreement and the replacement of the existing agreement by a new lease\nagreement undertaken by the same lessor or holder and the same lessee.\nThe term does not include: (a) the substitution of the leased vehicle or\nthe addition or return of a vehicle in a multiple-vehicle lease, if in\neither case the average payment allocable to a rental period is not\nincreased by more than twenty-five percent; (b) a deferral or extension\nof one or more periodic payments, or portions of a periodic payment; (c)\na reduction in charges in the agreement; (d) an agreement involving a\ncourt proceeding; or (e) any other agreement or event which does not\nconstitute a "renegotiation" under the act of Congress entitled\n"Consumer Leasing Act of 1976" and the regulations thereunder, as such\nact and regulations may from time to time be amended.\n 24. Words in the singular include the plural and vice versa.\n