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The Vermont Statutes Online
Title
09A
:
Uniform Commercial Code
Chapter
002A
:
Leases
§
2A-303. Alienability of party's interest under lease contract or of lessor's
residual interest in goods; delegation of
performance; transfer of rights
(1) As used in
this section, "creation of a security interest" includes the sale of
a lease contract that is subject to Article 9, Secured Transactions, by reason
of section 9-109(a)(3) of this title.
(2) Except as
provided in subsection (3) of this section and section 9-407 of this title, a
provision in a lease agreement which: (i) prohibits the voluntary or
involuntary transfer, including a transfer by sale, sublease, creation or
enforcement of a security interest, or attachment, levy, or other judicial
process, of an interest of a party under the lease contract or of the lessor's
residual interest in the goods, or (ii) makes such a transfer an event of
default, gives rise to the rights and remedies provided in subsection (4) of
this section, but a transfer that is prohibited or is an event of default under
the lease agreement is otherwise effective.
(3) A provision
in a lease agreement which: (i) prohibits a transfer of a right to damages for
default with respect to the whole lease contract or of a right to payment
arising out of the transferor's due performance of the transferor's entire
obligation, or (ii) makes such a transfer an event of default, is not
enforceable, and such a transfer is not a transfer that materially impairs the
prospect of obtaining return performance by, materially changes the duty of, or
materially increases the burden or risk imposed on, the other party to the
lease contract within the purview of subsection (4) of this section.
(4) Subject to
subsection (3) of this section and section 9-407 of this title:
(a) if a
transfer is made which is made an event of default under a lease agreement, the
party to the lease contract not making the transfer, unless that party waives
the default or otherwise agrees, has the rights and remedies described in
section 2A-501(2) of this title;
(b) if paragraph
(a) is not applicable and if a transfer is made that (i) is prohibited under a
lease agreement or (ii) materially impairs the prospect of obtaining return
performance by, materially changes the duty of, or materially increases the
burden or risk imposed on, the other party to the lease contract, unless the
party not making the transfer agrees at any time to the transfer in the lease
contract or otherwise, then, except as limited by contract, (i) the transferor
is liable to the party not making the transfer for damages caused by the
transfer to the extent that the damages could not reasonably be prevented by
the party not making the transfer and (ii) a court having jurisdiction may
grant other appropriate relief, including cancellation of the lease contract or
an injunction against the transfer.
(5) A transfer
of "the lease" or of "all my rights under the lease", or a
transfer in similar general terms, is a transfer of rights and, unless the
language or the circumstances, as in a transfer for security, indicate the
contrary, the transfer is a delegation of duties by the transferor to the
transferee. Acceptance by the transferee constitutes a promise by the
transferee to perform those duties. The promise is enforceable by either the
transferor or the other party to the lease contract.
(6) Unless
otherwise agreed by the lessor and the lessee, a delegation of performance does
not relieve the transferor as against the other party of any duty to perform or
of any liability for default.
(7) In a
consumer lease, to prohibit the transfer of an interest of a party under the
lease contract or to make a transfer an event of default, the language must be
specific, by a writing, and conspicuous. (Added 1993, No. 158 (Adj. Sess.), §
10, eff. Jan. 1, 1995; amended 1999, No. 106 (Adj. Sess.), § 11, eff. July 1,
2001.)