Search OpenLegislation Statutes
This entry was published on 2014-12-26
The selection dates indicate all change milestones for the entire volume, not just the location being viewed. Specifying a milestone date will retrieve the most recent version of the location before that date.
Cover; Substitute Goods
Uniform Commercial Code (UCC) CHAPTER 38, ARTICLE 2-A, PART 5
Section 2-A-518. Cover; Substitute Goods.

(1) After a default by a lessor under the lease contract of the type
described in Section 2-A-508(1) or, if agreed, after other default by
the lessor, the lessee may cover by making any purchase or lease of or
contract to purchase or lease goods in substitution for those due from
the lessor.

(2) Except as otherwise provided with respect to damages liquidated in
the lease agreement (Section 2-A-504) or otherwise determined pursuant
to agreement of the parties (Sections 1--302 and 2-A-503), if a lessee's
cover is by a lease agreement substantially similar to the original
lease agreement and the new lease agreement is made in good faith and in
a commercially reasonable manner, the lessee may recover from the lessor
as damages (a) the present value, as of the date of the commencement of
the term of the new lease agreement, of the rent under the new lease
agreement applicable to that period of the new lease term which is
comparable to the then remaining term of the original lease agreement
minus the present value as of the same date of the total rent for the
then remaining lease term of the original lease agreement, and (b) any
incidental or consequential damages, less expenses saved in consequence
of the lessor's default.

(3) If the lessee's cover is by lease agreement that qualifies for
treatment under subsection (2), the lessee may elect to proceed under
subsection (2) or Section 2-A-519. If a lessee's cover is by lease
agreement that for any reason does not qualify for treatment under
subsection (2), or is by purchase or otherwise, the lessee may recover
from the lessor as if the lessee had elected not to cover.