All of the above-mentioned safeguards granted to lessors under a financial lease can be obtained through contractual provisions. Official comments to the UZK state that “if a transaction is not considered a financial lend-lease, the parties can achieve the same result through an agreement.” UZK §7-2A-103, note (g). Indeed, the provisions of the ESDP “are only codifications of standard commercial leasing practices that have been carried out previously by contract and not by law”. Narrowed, at the top in Article 3.1.10[A]. Prestigious authorities therefore encourage owners to include explicit “hell or flood” clauses if they are in favor of it. Leasing can take several forms, one of which is a “finance lease” within the meaning of Article 2A of the Single Commercial Code (UZK). Unfortunately, the terminology “lease-financing” is sometimes confusing. Many people in the leasing industry use this term to refer to a transaction called “leasing,” but that is actually a loan from the lessor to the lessee, with the “leased asset” serving as collateral for the loan – such as a lease with a one-dollar purchase option. These people distinguish between finance leases and “genuine leasing contracts”, which are also referred to as “tax leasing” or “operating leasing”.
In order to avoid confusion, we will use the term “leasing designed as collateral” to refer to leases that are actual loans and the term “fake”, to refer to lease agreements that do not only mask security interests. There is no other reason than to avoid disputes over whether it is a “funder”. Id. in Article 3.1. [D]. According to Article 2A of the Uniform Commercial Code (“UZK”), the term “finance lease” is defined as a true financial lease, “consists of a three-party transaction as a whole, in which: (1) the lessor does not select, manufacture or deliver the goods, 2) the lessor does not own the goods before the conclusion of the lease agreement and (3) the lessee approves the contract of sale, or certain warranty and supplier information prior to the signing of the lease agreement n.” Ian Shrank and Arnold G. Gough, Equipment Leasing-Leveraged Leasing (PLI 4th ed., 1999), Vol. 1, §3:1.5[C].
“Leasing” has been described by one commentator as perhaps “the main source of individual financing to support business investment spending” Amelia H. Boss, The History of Article 2A: A Lesson for Practitioner and Scholar Alike, 39 Ala. L.Rev. 575, 577 (1988). Leasing involves three or more parties – the lessee, the lessor and the equipment manufacturer. The renter chooses the equipment and negotiates certain modifications with the appliance supplier. The owner then buys the selected equipment and rents it to the tenant. Traditionally, lessors participating in “leasing” were considered passive lessors whose operations remain functionally assimilated to a credit extension. See z.B.
Nath v. Nat. Equipment Leasing Corp., 439 Because of the limited role played by a lessor in leasing and the important role played by such transactions in our economy, section 2A provides special legal protection for lessors who so lease property. As stated in the comments to the UZK, the various sections of Article 2A function to “replace the supplier of the goods for the lessor as the party responsible for warranties and the like”. UZK § 2A-101, comments (highlighted here only). For example, Article 2A-209 automatically extends the seller`s warranties (and their exclusions) to the tenant and automatically excludes all implied warranties of fitness or fitness by the owner. . .