§ 336.2A-524 — Lessor's Right to Identify Goods to Lease Contract
Plain-Language Summary
When a lessee defaults, this section lets the wronged lessor designate (identify) goods to the lease contract so the lessor can deal with them. The lessor may identify conforming goods that were in the lessor's or supplier's possession when the default became known, and may dispose of goods clearly intended for that particular lease even if those goods are unfinished. For unfinished goods, the lessor or supplier may use reasonable commercial judgment to either finish manufacturing and identify them to the lease, or stop manufacturing and lease, sell, scrap, salvage, or otherwise dispose of them in a reasonable way to minimize loss.
336.2A-524 LESSOR’S RIGHT TO IDENTIFY GOODS TO LEASE CONTRACT.
(1) A lessor aggrieved under section 336.2A-523(1) may:
(a) identify to the lease contract conforming goods not already identified if at the time the lessor learned of the default they were in the lessor’s or the supplier’s possession or control; and
(b) dispose of goods (section 336.2A-527(1)) that demonstrably have been intended for the particular lease contract even though those goods are unfinished.
(2) If the goods are unfinished, in the exercise of reasonable commercial judgment for the purposes of avoiding loss and of effective realization, an aggrieved lessor or the supplier may either complete manufacture and wholly identify the goods to the lease contract or cease manufacture and lease, sell, or otherwise dispose of the goods for scrap or salvage value or proceed in any other reasonable manner.
History:
1989 c 232 art 1 s 2A-524
History: History: 1989 c 232 art 1 s 2A-524