(1)  As used in this section, “creation of a security interest” includes the sale of a lease contract subject to Title 70A, Chapter 9a, Uniform Commercial Code – Secured Transactions, by reason of Subsection 70A-9a-109(1)(c).

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Terms Used In Utah Code 70A-2a-303

  • Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
  • Consumer lease: means a lease that a lessor, regularly engaged in the business of leasing or selling, makes to a lessee, who is an individual and who takes under the lease primarily for a personal, family, or household purpose. See Utah Code 70A-2a-103
  • Contract: A legal written agreement that becomes binding when signed.
  • Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
  • Goods: means all things that are movable at the time of identification to the lease contract, or are fixtures. See Utah Code 70A-2a-103
  • Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
  • 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. See Utah Code 70A-2a-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 Utah Code 70A-2a-103
  • Lessee: means a person who acquires the right to possession and use of goods under a lease. See Utah Code 70A-2a-103
  • Lessor: means a person who transfers the right to possession and use of goods under a lease. See Utah Code 70A-2a-103
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Sublease: means a lease of goods, the right to possession and use of which was acquired by the lessor as a lessee under an existing lease. See Utah Code 70A-2a-103
  • Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
  • Writing: includes :Utah Code 68-3-12.5
(2)  Except as provided in Subsection (3) and Section 70A-9a-407, a provision in a lease agreement that 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 that makes such a transfer an event of default, gives rise to the rights and remedies provided in Subsection (4), 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 that 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 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).

(4)  Subject to Subsection (3) and Section 70A-9a-407:

(a)  if a transfer is made that 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 70A-2a-501; and

(b)  if Subsection (4)(a) is not applicable and if a transfer is made that is prohibited under a lease agreement, or 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, 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 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 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 writing, and conspicuous.

Amended by Chapter 252, 2000 General Session

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