Part 2: FORMATION AND CONSTRUCTION OF LEASE CONTRACT
§2-1219. Risk of loss
(1).
Except in the case of a finance lease, risk of loss is retained by the lessor and does not pass to the lessee. In the case
of a finance lease, risk of loss passes to the lessee.
[
1991, c. 805, §4 (NEW)
.]
(2).
Subject to the provisions of this Article on the effect of default on risk of loss (section 2-1220) if risk of loss is to
pass to the lessee and the time of passage is not stated, the following rules apply.
(a). If the lease contract requires or authorizes the goods to be shipped by carrier:
(i) If it does not require delivery at a particular destination, the risk of loss passes to the lessee when the goods are
duly delivered to the carrier; or
(ii) If it does require delivery at a particular destination and the goods are there duly tendered while in the possession
of the carrier, the risk of loss passes to the lessee when the goods are there duly so tendered as to enable the lessee to
take delivery. [1991, c. 805, §4 (NEW).]
(b). If the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the lessee on acknowledgment
by the bailee of the lessee's right to possession of the goods. [1991, c. 805, §4 (NEW).]
(c). In any case not within paragraph (a) or (b), the risk of loss passes to the lessee on the lessee's receipt of the goods
if the lessor, or, in the case of a finance lease, the supplier, is a merchant; otherwise the risk passes to the lessee on
tender or delivery. [RR 1993, c. 1, §29 (COR).]
[
RR 1993, c. 1, §29 (COR)
.]
SECTION HISTORY
1991, c. 805, §4 (NEW).
RR 1993, c. 1, §29 (COR).
Data for this page extracted on 10/16/2012 08:20:53.