Idaho State Statutes - Idaho Attorney Directory

28-12-303 - ALIENABILITY OF PARTY'S INTEREST UNDER LEASE CONTRACT OR OF LESSOR'S RESIDUAL INTEREST IN GOODS -- DELEGATION OF PERFORMANCE -- TRANSFER OF RIGHTS

ALIENABILITY OF PARTY'S INTEREST UNDER LEASE CONTRACT OR OF
LESSOR'S RESIDUAL INTEREST IN GOODS -- DELEGATION OF PERFORMANCE -- TRANSFER
OF RIGHTS. (1) As used in this section, "creation of a security interest"
includes the sale of a lease contract that is subject to chapter 9, title 28,
Idaho Code, secured transactions, by reason of section 28-9-109(a)(3).
(2) Except as provided in subsection (3) of this section and section
28-9-407, a provision in a lease agreement which: (i) 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 (ii) makes such a transfer an event of
default, gives rise to the rights and remedies provided in subsection (4) of
this section, 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 which: (i) 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 (ii) 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) of
this section.
(4) Subject to the provisions of subsection (3) of this section and
section 28-9-407:
(a) If a transfer is made which 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 28-12-501(2);
(b) If paragraph (a) of this subsection is not applicable and if a
transfer is made that: (i) is prohibited under a lease agreement or
(ii) 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, (i) 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 (ii) 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 of 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 a writing, and conspicuous.

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