(1) After a default by a lessee under the lease contract of the type
described in Section 2-A-523(1) or 2-A-523(3)(a) or after the lessor
refuses to deliver or takes possession of goods (Section 2-A-525 or
2-A-526), or, if agreed, after other default by a lessee, the lessor may
dispose of the goods concerned or the undelivered balance thereof by
lease, sale, or otherwise.
(2) Except as otherwise provided with respect to damages liquidated in
the lease agreement (Section 2-A-504) or otherwise determined pursuant
to agreement of the parties (Sections 1--302 and 2-A-503), if the
disposition is by lease agreement substantially similar to the original
lease agreement and the new lease agreement is made in good faith and in
a commercially reasonable manner, the lessor may recover from the lessee
as damages (a) accrued and unpaid rent as of the date of the
commencement of the term of the new lease agreement, (b) the present
value, as of the same date, of the total rent for the then remaining
lease term of the original lease agreement minus the present value, as
of the same date, of the rent under the new lease agreement applicable
to that period of the new lease term which is comparable to the then
remaining lease term of the original lease agreement, and (c) any
incidental damages allowed under Section 2-A-530, less expenses saved in
consequence of the lessee's default.
(3) If the lessor's disposition is by lease agreement that qualifies
for treatment under subsection (2), the lessor may elect to proceed
under subsection (2) or Section 2-A-528. If the lessor's disposition is
by lease agreement that for any reason does not qualify for treatment
under subsection (2), or is by sale or otherwise, the lessor may recover
from the lessee as if the lessor had elected not to dispose of the
goods.
(4) A subsequent buyer or lessee who buys or leases from the lessor in
good faith for value as a result of a disposition under this section
takes the goods free of the original lease contract and any rights of
the original lessee even though the lessor fails to comply with one or
more of the requirements of this Article.
(5) The lessor is not accountable to the lessee for any profit made on
any disposition. A lessee who has rightfully rejected or justifiably
revoked acceptance shall account to the lessor for any excess over the
amount of the lessee's security interest (Section 2-A-508(5)).
Structure New York Laws
2-A-502 - Notice After Default.
2-A-503 - Modification or Impairment of Rights and Remedies.
2-A-504 - Liquidation of Damages.
2-A-506 - Statute of Limitations.
2-A-507 - Proof of Market Rent: Time and Place.
2-A-509 - Lessee's Rights on Improper Delivery: Rightful Rejection.
2-A-510 - Installment Lease Contracts: Rejection and Default.
2-A-511 - Merchant Lessee's Duties as to Rightfully Rejected Goods.
2-A-512 - Lessee's Duties as to Rightfully Rejected Goods.
2-A-513 - Cure by Lessor of Improper Tender or Delivery; Replacement.
2-A-514 - Waiver of Lessee's Objections.
2-A-515 - Acceptance of Goods.
2-A-517 - Revocation of Acceptance of Goods.
2-A-518 - Cover; Substitute Goods.
2-A-520 - Lessee's Incidental and Consequential Damages.
2-A-521 - Lessee's Right to Specific Performance or Replevin.
2-A-522 - Lessee's Right to Goods on Lessor's Insolvency.
2-A-524 - Lessor's Right to Identify Goods to Lease Contract.
2-A-525 - Lessor's Right to Possession of Goods.
2-A-526 - Lessor's Stoppage of Delivery in Transit or Otherwise.
2-A-527 - Lessor's Rights to Dispose of Goods.
2-A-528 - Lessor's Damages for Non-Acceptance, Failure to Pay, Repudiation, or Other Default.
2-A-529 - Lessor's Action for the Rent.
2-A-530 - Lessor's Incidental Damages.
2-A-531 - Standing to Sue Third Parties for Injury to Goods.