Idaho Code 28-12-304 – Subsequent Lease of Goods by Lessor

(1) Subject to section 28-12-303, a subsequent lessee from a lessor of goods under an existing lease contract obtains, to the extent of the leasehold interest transferred, the leasehold interest in the goods that the lessor had or had power to transfer, and except as provided in subsection (2) of this section and section 28-12-527(4), takes subject to the existing lease contract. A lessor with voidable title has power to transfer a good leasehold interest to a good faith subsequent lessee for value, but only to the extent set forth in the preceding sentence. If goods have been delivered under a transaction of purchase, the lessor has that power even though:

(a) The lessor’s transferor was deceived as to the identity of the lessor;

(b) The delivery was in exchange for a check which is later dishonored;

(d) The delivery was procured through fraud punishable as larcenous under the criminal law.

(2) A subsequent lessee in the ordinary course of business from a lessor who is a merchant dealing in goods of that kind to whom the goods were entrusted by the existing lessee of that lessor before the interest of the subsequent lessee became enforceable against that lessor obtains, to the extent of the leasehold interest transferred, all of that lessor’s and the existing lessee’s rights to the goods, and takes free of the existing lease contract.

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Terms Used In Idaho Code 28-12-304

Contract: A legal written agreement that becomes binding when signed.
Fraud: Intentional deception resulting in injury to another.
Goods: means all things that are movable at the time of identification to the lease contract, or are fixtures (section 28-12-309, Idaho Code), but the term does not include money, documents, instruments, accounts, chattel paper, general intangibles, or minerals or the like, including oil and gas, before extraction. See Idaho Code 28-12-103
Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). ^{Source: OCC}
Lease: means a transfer of the right to possession and use of goods for a term in return for consideration, but a sale, including a sale on approval or a sale or return, or retention or creation of a security interest is not a lease. See Idaho Code 28-12-103
Lease contract: means the total legal obligation that results from the lease agreement as affected by this chapter and any other applicable rules of law. See Idaho Code 28-12-103
Leasehold interest: means the interest of the lessor or the lessee under a lease contract. See Idaho Code 28-12-103
Lessee: means a person who acquires the right to possession and use of goods under a lease. See Idaho Code 28-12-103
Lessor: means a person who transfers the right to possession and use of goods under a lease. See Idaho Code 28-12-103
Purchase: includes taking by sale, lease, mortgage, security interest, pledge, gift or any other voluntary transaction creating an interest in goods. See Idaho Code 28-12-103
State: when applied to the different parts of the United States, includes the District of Columbia and the territories; and the words "United States" may include the District of Columbia and territories. See Idaho Code 73-114
Statute: A law passed by a legislature.

(3) A subsequent lessee from the lessor of goods that are subject to an existing lease contract and are covered by a certificate of title issued under a statute of this state or of another jurisdiction takes no greater rights than those provided both by this section and by the certificate of title statute.