Indiana Code
Chapter 2.1. Leases
26-1-2.1-511. Merchant Lessee's Duties as to Rightfully Rejected Goods

Sec. 511. (1) Subject to any security interest of a lessee (IC 26-1-2.1-508(5)), if a lessor or a supplier has no agent or place of business at the market of rejection, a merchant lessee, after rejection of goods in the merchant lessee's possession or control, shall follow any reasonable instructions received from the lessor or the supplier with respect to the goods. In the absence of those instructions, a merchant lessee shall make reasonable efforts to sell, lease, or otherwise dispose of the goods for the lessor's account if they threaten to decline in value speedily. Instructions are not reasonable if on demand indemnity for expenses is not forthcoming.
(2) If a merchant lessee (subsection (1)) or any other lessee (IC 26-1-2.1-512) disposes of goods, the merchant lessee is entitled to reimbursement either from the lessor or the supplier or out of the proceeds for reasonable expenses of caring for and disposing of the goods and, if the expenses include no disposition commission, to such commission as is usual in the trade, or if there is none, to a reasonable sum not exceeding ten percent (10%) of the gross proceeds.
(3) In complying with this section or IC 26-1-2.1-512, the lessee is held only to good faith. Good faith conduct hereunder is neither acceptance or conversion nor the basis of an action for damages.
(4) A purchaser who purchases in good faith from a lessee pursuant to this section or IC 26-1-2.1-512 takes the goods free of any rights of the lessor and the supplier even though the lessee fails to comply with one or more of the requirements of IC 26-1-2.1.
As added by P.L.189-1991, SEC.3.

Structure Indiana Code

Indiana Code

Title 26. Commercial Law

Article 1. Uniform Commercial Code

Chapter 2.1. Leases

26-1-2.1-101. Short Title

26-1-2.1-102. Scope

26-1-2.1-103. Definitions and Index of Definitions

26-1-2.1-104. Leases Subject to Other Statutes

26-1-2.1-105. Territorial Application of Article to Goods Covered by Certificate of Title

26-1-2.1-106. Limitation on Power of Parties to Consumer Lease to Choose Applicable Law and Judicial Forum

26-1-2.1-107. Waiver or Renunciation of Claim or Right After Default

26-1-2.1-108. Unconscionability

26-1-2.1-109. Option to Accelerate at Will

26-1-2.1-201. Statute of Frauds

26-1-2.1-202. Final Written Expression; Parol or Extrinsic Evidence

26-1-2.1-203. Seals Inoperative

26-1-2.1-204. Formation in General

26-1-2.1-205. Firm Offers

26-1-2.1-206. Offer and Acceptance in Formation of Lease Contract

26-1-2.1-207. Repealed

26-1-2.1-208. Modification, Rescission, and Waiver

26-1-2.1-209. Lessee Under Finance Lease as Beneficiary of Supply Contract

26-1-2.1-210. Express Warranties

26-1-2.1-211. Warranties Against Interference and Against Infringement; Lessee's Obligation Against Infringement

26-1-2.1-212. Implied Warranty of Merchantability

26-1-2.1-213. Implied Warranty of Fitness for Particular Purpose

26-1-2.1-214. Exclusion or Modification of Warranties

26-1-2.1-215. Cumulation and Conflict of Warranties Express or Implied

26-1-2.1-216. Third-Party Beneficiaries of Express and Implied Warranties

26-1-2.1-217. Identification

26-1-2.1-218. Insurance and Proceeds

26-1-2.1-219. Risk of Loss

26-1-2.1-220. Effect of Default on Risk of Loss

26-1-2.1-221. Casualty to Identified Goods

26-1-2.1-301. Enforceability of Lease Contract

26-1-2.1-302. Title to and Possession of Goods

26-1-2.1-303. "Creation of a Security Interest"; Alienability of Party's Interest Under Lease Contract or of Lessor's Residual Interest in Goods; Delegation of Performance; Assignment of Rights

26-1-2.1-304. Subsequent Lease of Goods by Lessor

26-1-2.1-305. Sale or Sublease of Goods by Lessee

26-1-2.1-306. Priority of Certain Liens Arising by Operation of Law

26-1-2.1-307. Priority of Liens Related to Lease Contract

26-1-2.1-308. Special Rights of Creditors

26-1-2.1-309. Lessor's and Lessee's Rights When Goods Become Fixtures

26-1-2.1-310. Lessor's and Lessee's Rights When Goods Become Accessions

26-1-2.1-311. Subordination by Agreement; Persons Entitled to Priority

26-1-2.1-401. Insecurity; Adequate Assurance of Performance

26-1-2.1-402. Anticipatory Repudiation

26-1-2.1-403. Retraction of Anticipatory Repudiation

26-1-2.1-404. Substituted Performance

26-1-2.1-405. Excused Performance

26-1-2.1-406. Procedure on Excused Performance

26-1-2.1-407. Irrevocable Promises; Finance Leases

26-1-2.1-501. Default; Procedure

26-1-2.1-502. Notice After Default

26-1-2.1-503. Modification or Impairment of Rights and Remedies

26-1-2.1-504. Liquidation of Damages

26-1-2.1-505. Cancellation and Termination and Effect of Cancellation, Termination, Rescission, or Fraud on Rights and Remedies

26-1-2.1-506. Statute of Limitations

26-1-2.1-507. Proof of Market Rent; Time and Place

26-1-2.1-508. Lessee's Remedies

26-1-2.1-509. Lessee's Rights on Improper Delivery; Rightful Rejection

26-1-2.1-510. Installment Lease Contracts; Rejection and Default

26-1-2.1-511. Merchant Lessee's Duties as to Rightfully Rejected Goods

26-1-2.1-512. Lessee's Duties as to Rightfully Rejected Goods

26-1-2.1-513. Cure by Lessor of Improper Tender or Delivery; Replacement

26-1-2.1-514. Waiver of Lessee's Objections

26-1-2.1-515. Acceptance of Goods

26-1-2.1-516. Effect of Acceptance of Goods; Notice of Default; Burden of Establishing

26-1-2.1-517. Revocation of Acceptance of Goods

26-1-2.1-518. Cover; Substitute Goods

26-1-2.1-519. Lessee's Damages for Nondelivery, Repudiation, Default, and Breach of Warranty in Regard to Accepted Goods

26-1-2.1-520. Lessee's Incidental and Consequential Damages

26-1-2.1-521. Lessee's Right to Specific Performance or Replevin

26-1-2.1-522. Lessee's Right to Goods on Lessor's Insolvency

26-1-2.1-523. Lessor's Remedies

26-1-2.1-524. Lessor's Right to Identify Goods to Lease Contract

26-1-2.1-525. Lessor's Right to Possession of Goods

26-1-2.1-526. Lessor's Stoppage of Delivery

26-1-2.1-527. Lessor's Rights to Dispose of Goods

26-1-2.1-528. Lessor's Damages for Nonacceptance or Repudiation

26-1-2.1-529. Lessor's Action for the Rent

26-1-2.1-530. Lessor's Incidental Damages

26-1-2.1-531. Standing to Sue Third Parties for Injury to Goods

26-1-2.1-532. Recovery by Lessor for Loss of or Damage to Residual Interest