§ 2-A-527 — Lessor's Rights to Dispose of Goods

Section 2-A-527. Lessor's Rights to Dispose of Goods.\n (1) After a default by a lessee under the lease contract of the type\ndescribed in Section 2-A-523(1) or 2-A-523(3)(a) or after the lessor\nrefuses to deliver or takes possession of goods (Section 2-A-525 or\n2-A-526), or, if agreed, after other default by a lessee, the lessor may\ndispose of the goods concerned or the undelivered balance thereof by\nlease, sale, or otherwise.\n (2) Except as otherwise provided with respect to damages liquidated in\nthe lease agreement (Section 2-A-504) or otherwise determined pursuant\nto agreement of the parties (Sections 1--302 and 2-A-503), if the\ndisposition is by lease agreement substantially similar to the original\nlease agreement and the new lease agreement is made in good faith and in\na commercially reasonable manner, the lessor may recover from the lessee\nas damages (a) accrued and unpaid rent as of the date of the\ncommencement of the term of the new lease agreement, (b) the present\nvalue, as of the same date, of the total rent for the then remaining\nlease term of the original lease agreement minus the present value, as\nof the same date, of the rent under the new lease agreement applicable\nto that period of the new lease term which is comparable to the then\nremaining lease term of the original lease agreement, and (c) any\nincidental damages allowed under Section 2-A-530, less expenses saved in\nconsequence of the lessee's default.\n (3) If the lessor's disposition is by lease agreement that qualifies\nfor treatment under subsection (2), the lessor may elect to proceed\nunder subsection (2) or Section 2-A-528. If the lessor's disposition is\nby lease agreement that for any reason does not qualify for treatment\nunder subsection (2), or is by sale or otherwise, the lessor may recover\nfrom the lessee as if the lessor had elected not to dispose of the\ngoods.\n (4) A subsequent buyer or lessee who buys or leases from the lessor in\ngood faith for value as a result of a disposition under this section\ntakes the goods free of the original lease contract and any rights of\nthe original lessee even though the lessor fails to comply with one or\nmore of the requirements of this Article.\n (5) The lessor is not accountable to the lessee for any profit made on\nany disposition. A lessee who has rightfully rejected or justifiably\nrevoked acceptance shall account to the lessor for any excess over the\namount of the lessee's security interest (Section 2-A-508(5)).\n