reglab/statecodes huggingface dataset:
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-215 - Cumulation and Conflict of Warranties Express or Implied.

Section 7-2A-215
Cumulation and conflict of warranties express or implied.
Warranties, whether express or implied, must be construed as consistent with each other and as cumulative, but if that construction is unreasonable, the intention of the parties determines which warranty is dominant. In ascertaining that intention the following rules apply:
(a) Exact or technical specifications displace an inconsistent sample or model or general language of description.
(b) A sample from an existing bulk displaces inconsistent general language of description.
(c) Express warranties displace inconsistent implied warranties other than an implied warranty of fitness for a particular purpose.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §215.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-216 - Third-Party Beneficiaries of Express and Implied Warranties.

Section 7-2A-216
Third-party beneficiaries of express and implied warranties.
(1) A warranty to or for the benefit of a lessee under this article, whether express or implied, extends to any natural person who may reasonably be expected to use, consume, or be affected by the goods and who is injured in person by breach of the warranty.
(2) This section does not displace principles of law and equity that extend a warranty to or for the benefit of a lessee to other persons.
(3) The operation of this section may not be excluded, modified, or limited, but an exclusion, modification, or limitation of the warranty, including any with respect to rights and remedies, effective against the lessee is also effective against any person referred to in subsections (1) and (2) of this section.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §216.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-217 - Identification.

Section 7-2A-217
Identification.
Identification of goods as goods to which a lease contract refers may be made at any time and in any manner explicitly agreed to by the parties. In the absence of explicit agreement, identification occurs:
(a) when the lease contract is made if the lease contract is for a lease of goods that are existing and identified;
(b) when the goods are shipped, marked, or otherwise designated by the lessor as goods to which the lease contract refers, if the lease contract is for a lease of goods that are not existing and identified; or
(c) when the young are conceived, if the lease contract is for a lease of unborn young of animals.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §217.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-218 - Insurance and Proceeds.

Section 7-2A-218
Insurance and proceeds.
(1) A lessee obtains an insurable interest when existing goods are identified to the lease contract even though the goods identified are nonconforming and the lessee has an option to reject them.
(2) If a lessee has an insurable interest only by reason of the lessor's identification of the goods, the lessor, until the lessor's default or insolvency or notification to the lessee that identification is final, may substitute other goods for those identified.
(3) Notwithstanding a lessee's insurable interest under subsections (1) and (2), the lessor retains an insurable interest until an option to buy has been exercised by the lessee and risk of loss has passed to the lessee. For this purpose the option to buy shall be deemed to have been exercised by the lessee when the resulting sale is closed, not when the lessee gives notice to the lessor of the lessee's intention to exercise the option.
(4) Nothing in this section impairs any insurable interest recognized under any other statute or rule of law.
(5) The parties by agreement may determine that one or more parties have an obligation to obtain and pay for insurance covering the goods and by agreement may determine the beneficiary of the proceeds of the insurance.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §218.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-219 - Risk of Loss.

Section 7-2A-219
Risk of loss.
(1) Except in the case of a finance lease, risk of loss is retained by the lessor and does not pass to the lessee. In the case of a finance lease, risk of loss passes to the lessee.
(2) Subject to the provisions of this article on the effect of default on risk of loss (Section 7-2A-220), if risk of loss is to pass to the lessee and the time of passage is not stated, the following rules apply:
(a) If the lease contract requires or authorizes the goods to be shipped by carrier
(i) and it does not require delivery at a particular destination, the risk of loss passes to the lessee when the goods are duly delivered to the carrier; but
(ii) if it does require delivery at a particular destination and the goods are there duly tendered while in the possession of the carrier, the risk of loss passes to the lessee when the goods are there duly so tendered as to enable the lessee to take delivery.
(b) If the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the lessee on acknowledgment by the bailee of the lessee's right to possession of the goods.
(c) In any case not within subsection (a) or (b), the risk of loss passes to the lessee on the lessee's receipt of the goods if the lessor, or, in the case of a finance lease, the supplier, is a merchant; otherwise the risk passes to the lessee on tender of delivery.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §219.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-220 - Effect of Default on Risk of Loss.

Section 7-2A-220
Effect of default on risk of loss.
(1) Where risk of loss is to pass to the lessee and the time of passage is not stated:
(a) If a tender or delivery of goods so fails to conform to the lease contract as to give a right of rejection, the risk of their loss remains with the lessor, or, in the case of a finance lease, the supplier, until cure or acceptance.
(b) If the lessee rightfully revokes acceptance, he or she, to the extent of any deficiency in his or her effective insurance coverage, may treat the risk of loss as having remained with the lessor from the beginning.
(2) Whether or not risk of loss is to pass to the lessee, if the lessee as to conforming goods already identified to a lease contract repudiates or is otherwise in default under the lease contract, the lessor, or, in the case of a finance lease, the supplier, to the extent of any deficiency in his or her effective insurance coverage may treat the risk of loss as resting on the lessee for a commercially reasonable time.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §220.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 2 - Formation and Construction of Lease Contract. › Section 7-2A-221 - Casualty to Identified Goods.

Section 7-2A-221
Casualty to identified goods.
If a lease contract requires goods identified when the lease contract is made, and the goods suffer casualty without fault of the lessee, the lessor or the supplier before delivery, or the goods suffer casualty before risk of loss passes to the lessee pursuant to the lease agreement or Section 7-2A-219, then:
(a) if the loss is total, the lease contract is voided; and
(b) if the loss is partial or the goods have so deteriorated as to no longer conform to the lease contract, the lessee may nevertheless demand inspection and at his or her option either treat the lease contract as voided or, except in a finance lease, accept the goods with due allowance from the rent payable for the balance of the lease term for the deterioration or the deficiency in quantity but without further right against the lessor.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §221.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-301 - Enforceability of Lease Contract.

Section 7-2A-301
Enforceability of lease contract.
Except as otherwise provided in this article, a lease contract is effective and enforceable according to its terms between the parties, against purchasers of the goods and against creditors of the parties.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §301.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-302 - Title to and Possession of Goods.

Section 7-2A-302
Title to and possession of goods.
Except as otherwise provided in this article, each provision of this article applies whether the lessor or a third party has title to the goods, and whether the lessor, the lessee, or a third party has possession of the goods, notwithstanding any statute or rule of law that possession or the absence of possession is fraudulent.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §302.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-304 - Subsequent Lease of Goods by Lessor.

Section 7-2A-304
Subsequent lease of goods by lessor.
(1) Subject to Section 7-2A-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) and Section 7-2A-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;
(c) it was agreed that the transaction was to be a "cash sale"; or
(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.
(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.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §304.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-305 - Sale or Sublease of Goods by Lessee.

Section 7-2A-305
Sale or sublease of goods by lessee.
(1) Subject to the provisions of Section 7-2A-303, a buyer or sublessee from the lessee of goods under an existing lease contract obtains, to the extent of the interest transferred, the leasehold interest in the goods that the lessee had or had power to transfer, and except as provided in subsection (2) and Section 7-2A-511(4), takes subject to the existing lease contract. A lessee with a voidable leasehold interest has power to transfer a good leasehold interest to a good faith buyer for value or a good faith sublessee for value, but only to the extent set forth in the preceding sentence. When goods have been delivered under a transaction of lease the lessee has that power even though:
(a) the lessor was deceived as to the identity of the lessee;
(b) the delivery was in exchange for a check which is later dishonored; or
(c) the delivery was procured through fraud punishable as larcenous under the criminal law.
(2) A buyer in the ordinary course of business or a sublessee in the ordinary course of business from a lessee who is a merchant dealing in goods of that kind to whom the goods were entrusted by the lessor obtains, to the extent of the interest transferred, all of the lessor's and lessee's rights to the goods, and takes free of the existing lease contract.
(3) A buyer or sublessee from the lessee 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.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §305.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-306 - Priority of Certain Liens Arising by Operation of Law.

Section 7-2A-306
Priority of certain liens arising by operation of law.
If a person in the ordinary course of his or her business furnishes services or materials with respect to goods subject to a lease contract, a lien upon those goods in the possession of that person given by statute or rule of law for those materials or services takes priority over any interest of the lessor or lessee under the lease contract or this article unless the lien is created by statute and the statute provides otherwise or unless the lien is created by rule of law and the rule of law provides otherwise.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §306.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-307 - Priority Over Lease Contract.

Section 7-2A-307
Priority over lease contract.
(1) Except as otherwise provided in Section 7-2A-306, a creditor of a lessee takes subject to the lease contract.
(2) Except as otherwise provided in subsection (3) and in Sections 7-2A-306 and 7-2A-308, a creditor of a lessor takes subject to the lease contract unless the creditor holds a lien that attached to the goods before the lease contract became enforceable.
(3) Except as otherwise provided in Sections 7-9A-317, 7-9A-321, and 7-9A-323, a lessee takes a leasehold interest subject to a security interest held by a creditor of the lessor.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §307; Act 2001-481, p. 647, §2.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-308 - Special Rights of Creditors.

Section 7-2A-308
Special rights of creditors.
(1) A creditor of a lessor in possession of goods subject to a lease contract may treat the lease contract as void if as against the creditor retention of possession by the lessor is fraudulent under any statute or rule of law, but retention of possession in good faith and current course of trade by the lessor for a commercially reasonable time after the lease contract becomes enforceable is not fraudulent.
(2) Nothing in this article impairs the rights of creditors of a lessor if the lease contract is made under circumstances which under any statute or rule of law apart from this article would constitute the transaction a fraudulent transfer or voidable preference.
(3) A creditor of a seller may treat a sale or an identification of goods to a contract for sale as void if as against the creditor retention of possession by the seller is fraudulent under any statute or rule of law, but retention of possession of the goods pursuant to a lease contract entered into by the seller as lessee and the buyer as lessor in connection with the sale or identification of the goods is not fraudulent if the buyer bought for value and in good faith.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §308.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-310 - Lessor's and Lessee's Rights When Goods Become Accessions.

Section 7-2A-310
Lessor's and lessee's rights when goods become accessions.
(1) Goods are "accessions" when they are installed in or affixed to other goods.
(2) The interest of a lessor or a lessee under a lease contract entered into before the goods became accessions is superior to all interests in the whole except as stated in subsection (4).
(3) The interest of a lessor or a lessee under a lease contract entered into at the time or after the goods became accessions is superior to all subsequently acquired interests in the whole except as stated in subsection (4) but is subordinate to interests in the whole existing at the time the lease contract was made unless the holders of such interests in the whole have in writing consented to the lease or disclaimed an interest in the goods as part of the whole.
(4) The interest of a lessor or a lessee under a lease contract described in subsection (2) or (3) is subordinate to the interest of
(a) a buyer in the ordinary course of business or a lessee in the ordinary course of business of any interest in the whole acquired after the goods became accessions; or
(b) a creditor with a security interest in the whole perfected before the lease contract was made to the extent that the creditor makes subsequent advances without knowledge of the lease contract.
(5) When under subsections (2) or (3) and (4) a lessor or a lessee of accessions holds an interest that is superior to all interests in the whole, the lessor or the lessee may (a) on default, expiration, termination, or cancellation of the lease contract by the other party but subject to the provisions of the lease contract and this article, or (b) if necessary to enforce his or her other rights and remedies under this article, remove the goods from the whole, free and clear of all interests in the whole, but he or she must reimburse any holder of an interest in the whole who is not the lessee and who has not otherwise agreed for the cost of repair of any physical injury but not for any diminution in value of the whole caused by the absence of the goods removed or by any necessity for replacing them. A person entitled to reimbursement may refuse permission to remove until the party seeking removal gives adequate security for the performance of this obligation.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §310.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 3 - Effect of Lease Contract. › Section 7-2A-311 - Priority Subject to Subordination.

Section 7-2A-311
Priority subject to subordination.
Nothing in this article prevents subordination by agreement by any person entitled to priority.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §311.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-401 - Insecurity: Adequate Assurance of Performance.

Section 7-2A-401
Insecurity: Adequate assurance of performance.
(1) A lease contract imposes an obligation on each party that the other's expectation of receiving due performance will not be impaired.
(2) If reasonable grounds for insecurity arise with respect to the performance of either party, the insecure party may demand in writing adequate assurance of due performance. Until the insecure party receives that assurance, if commercially reasonable the insecure party may suspend any performance for which he or she has not already received the agreed return.
(3) A repudiation of the lease contract occurs if assurance of due performance adequate under the circumstances of the particular case is not provided to the insecure party within a reasonable time, not to exceed 30 days after receipt of the demand by the other party.
(4) Between merchants, the reasonableness of grounds for insecurity and the adequacy of any assurance offered must be determined according to commercial standards.
(5) Acceptance of any nonconforming delivery or payment does not prejudice the aggrieved party's right to demand adequate assurance of future performance.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §401.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-402 - Anticipatory Repudiation.

Section 7-2A-402
Anticipatory repudiation.
(1) If either party repudiates a lease contract with respect to a performance not yet due under the lease contract, the loss of which performance will substantially impair the value of the lease contract to the other, the aggrieved party may:
(a) for a commercially reasonable time, await retraction of repudiation and performance by the repudiating party;
(b) make demand pursuant to Section 7-2A-401 and await assurance of future performance adequate under the circumstances of the particular case; or
(c) resort to any right or remedy upon default under the lease contract or this article, even though the aggrieved party has notified the repudiating party that the aggrieved party would await the repudiating party's performance and assurance and has urged retraction.
(2) In addition, whether or not the aggrieved party is pursuing one of the foregoing remedies, the aggrieved party may suspend performance or, if the aggrieved party is the lessor, proceed in accordance with the provisions of this article on the lessor's right to identify goods to the lease contract notwithstanding default or to salvage unfinished goods (Section 7-2A-524).
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §402.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-403 - Retraction of Anticipatory Repudiation.

Section 7-2A-403
Retraction of anticipatory repudiation.
(1) Until the repudiating party's next performance is due, the repudiating party can retract the repudiation unless, since the repudiation, the aggrieved party has cancelled the lease contract or materially changed the aggrieved party's position or otherwise indicated that the aggrieved party considers the repudiation final.
(2) Retraction may be by any method that clearly indicates to the aggrieved party that the repudiating party intends to perform under the lease contract and includes any assurance demanded under Section 7-2A-401.
(3) Retraction reinstates a repudiating party's rights under a lease contract with due excuse and allowance to the aggrieved party for any delay occasioned by the repudiation.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §403.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-404 - Substituted Performance.

Section 7-2A-404
Substituted performance.
(1) If without fault of the lessee, the lessor and the supplier, the agreed berthing, loading, or unloading facilities fail or the agreed type of carrier becomes unavailable or the agreed manner of delivery otherwise becomes commercially impracticable, but a commercially reasonable substitute is available, the substitute performance must be tendered and accepted.
(2) If the agreed means or manner of payment fails because of domestic or foreign governmental regulation:
(a) the lessor may withhold or stop delivery or cause the supplier to withhold or stop delivery unless the lessee provides a means or manner of payment that is commercially a substantial equivalent; and
(b) if delivery has already been taken, payment by the means or in the manner provided by the regulation discharges the lessee's obligation unless the regulation is discriminatory, oppressive, or predatory.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §404.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-405 - Excused Performance.

Section 7-2A-405
Excused performance.
Subject to Section 7-2A-404 on substituted performance, the following rules apply:
(a) Delay in delivery or nondelivery in whole or in part by a lessor or a supplier who complies with paragraphs (b) and (c) is not a default under the lease contract if performance as agreed has been made impracticable by the occurrence of a contingency the nonoccurrence of which was a basic assumption on which the lease contract was made or by compliance in good faith with any applicable foreign or domestic governmental regulation or order, whether or not the regulation or order later proves to be invalid.
(b) If the causes mentioned in paragraph (a) affect only part of the lessor's or the supplier's capacity to perform, he or she shall allocate production and deliveries among his or her customers but at his or her option may include regular customers not then under contract for sale or lease as well as his or her own requirements for further manufacture. He or she may so allocate in any manner that is fair and reasonable.
(c) The lessor seasonably shall notify the lessee and in the case of a finance lease the supplier seasonably shall notify the lessor and the lessee, if known, that there will be delay or nondelivery and, if allocation is required under paragraph (b), of the estimated quota thus made available for the lessee.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §405.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-406 - Procedure on Excused Performance.

Section 7-2A-406
Procedure on excused performance.
(1) If the lessee receives notification of a material or indefinite delay or an allocation justified under Section 7-2A-405, the lessee may by written notification to the lessor as to any goods involved, and with respect to all of the goods if under an installment lease contract the value of the whole lease contract is substantially impaired (Section 7-2A-510):
(a) terminate the lease contract (Section 7-2A-505(2)); or
(b) except in a finance lease, modify the lease contract by accepting the available quota in substitution, with due allowance from the rent payable for the balance of the lease term for the deficiency but without further right against the lessor.
(2) If, after receipt of a notification from the lessor under Section 7-2A-405, the lessee fails so to modify the lease agreement within a reasonable time not exceeding 30 days, the lease contract lapses with respect to any deliveries affected.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §406.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 4 - Performance of Lease Contract: Repudiated, Substituted and Excused. › Section 7-2A-407 - Irrevocable Promises: Finance Leases.

Section 7-2A-407
Irrevocable promises: Finance leases.
(1) In the case of a finance lease that is not a consumer lease the lessee's promises under the lease contract become irrevocable and independent upon the lessee's acceptance of the goods.
(2) A promise that has become irrevocable and independent under subsection (1):
(a) is effective and enforceable between the parties, and by or against third parties including assignees of the parties; and
(b) is not subject to cancellation, termination, modification, repudiation, excuse, or substitution without the consent of the party to whom the promise runs.
(3) This section does not affect the validity under any other law of a covenant in any lease contract making the lessee's promises irrevocable and independent upon the lessee's acceptance of the goods.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §407.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-501 - Default: Procedure.

Section 7-2A-501
Default: Procedure.
(1) Whether the lessor or the lessee is in default under a lease contract is determined by the lease agreement and this article.
(2) If the lessor or the lessee is in default under the lease contract, the party seeking enforcement has rights and remedies as provided in this article and, except as limited by this article, as provided in the lease agreement.
(3) If the lessor or the lessee is in default under the lease contract, the party seeking enforcement may reduce the party's claim to judgment, or otherwise enforce the lease contract by self-help or any available judicial procedure or nonjudicial procedure, including administrative proceeding, arbitration, or the like, in accordance with this article.
(4) Except as otherwise provided in Section 7-1-305(a), or this article or the lease agreement, the rights and remedies referred to in subsections (2) and (3) are cumulative.
(5) If the lease agreement covers both real property and goods, the party seeking enforcement may proceed under this part as to the goods, or under other applicable law as to both the real property and the goods in accordance with that party's rights and remedies in respect of the real property, in which case this part does not apply.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §501; Act 2004-524, p. 1070, §2.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-502 - Notice After Default.

Section 7-2A-502
Notice after default.
Except as otherwise provided in this article or the lease agreement, the lessor or lessee in default under the lease contract is not entitled to notice of default or notice of enforcement from the other party to the lease agreement.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §502.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-503 - Modification or Impairment of Rights and Remedies.

Section 7-2A-503
Modification or impairment of rights and remedies.
(1) Except as otherwise provided in this article, the lease agreement may include rights and remedies for default in addition to or in substitution for those provided in this article and may limit or alter the measure of damages recoverable under this article.
(2) Resort to a remedy provided under this article or in the lease agreement is optional unless the remedy is expressly agreed to be exclusive. If circumstances cause an exclusive or limited remedy to fail of its essential purpose, or provision for an exclusive remedy is unconscionable, remedy may be had as provided in this article.
(3) Consequential damages may be liquidated under Section 7-2A-504, or may otherwise be limited, altered, or excluded unless the limitation, alteration, or exclusion is unconscionable. Limitation, alteration, or exclusion of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation, alteration, or exclusion of damages where the loss is commercial is not prima facie unconscionable.
(4) Rights and remedies on default by the lessor or the lessee with respect to any obligation or promise collateral or ancillary to the lease contract are not impaired by this article.
(5) Nothing in this section or in Section 7-2A-504 shall be construed so as to limit or expand the lessor's liability for damages for injury to the person in the case of consumer goods.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §503.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-504 - Liquidation of Damages.

Section 7-2A-504
Liquidation of damages.
(1) Damages payable by either party for default, or any other act or omission, including indemnity for loss or diminution of anticipated tax benefits or loss or damage to lessor's residual interest, may be liquidated in the lease agreement but only at an amount or by a formula that is reasonable in light of the then anticipated harm caused by the default or other act or omission.
(2) If the lease agreement provides for liquidation of damages, and such provision does not comply with subsection (1), or such provision is an exclusive or limited remedy that circumstances cause to fail of its essential purpose, remedy may be had as provided in this article.
(3) If the lessor justifiably withholds or stops delivery of goods because of the lessee's default or insolvency (Section 7-2A-525 or 7-2A-526), the lessee is entitled to restitution of any amount by which the sum of his or her payments exceeds:
(a) the amount to which the lessor is entitled by virtue of terms liquidating the lessor's damages in accordance with subsection (1); or
(b) in the absence of those terms, 20 percent of the then present value of the total rent the lessee was obligated to pay for the balance of the lease term, or, in the case of a consumer lease, the lesser of such amount or $500.
(4) A lessee's right to restitution under subsection (3) is subject to offset to the extent the lessor establishes:
(a) a right to recover damages under the provisions of this article other than subsection (1); and
(b) the amount or value of any benefits received by the lessee directly or indirectly by reason of the lease contract.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §504.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-505 - Cancellation and Termination and Effect of Cancellation, Termination, Rescission, or Fraud on Rights and Remedies.

Section 7-2A-505
Cancellation and termination and effect of cancellation, termination, rescission, or fraud on rights and remedies.
(1) On cancellation of the lease contract, all obligations that are still executory on both sides are discharged, but any right based on prior default or performance survives, and the cancelling party also retains any remedy for default of the whole lease contract or any unperformed balance.
(2) On termination of the lease contract, all obligations that are still executory on both sides are discharged but any right based on prior default or performance survives.
(3) Unless the contrary intention clearly appears, expressions of "cancellation," "rescission," or the like of the lease contract may not be construed as a renunciation or discharge of any claim in damages for an antecedent default.
(4) Rights and remedies for material misrepresentation or fraud include all rights and remedies available under this article for default.
(5) Neither rescission nor a claim for rescission of the lease contract nor rejection or return of the goods may bar or be deemed inconsistent with a claim for damages or other right or remedy.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §505.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-506 - Statute of Limitations.

Section 7-2A-506
Statute of limitations.
(1) An action for default under a lease contract, including breach of warranty or indemnity, must be commenced within 4 years after the cause of action accrued. By the original lease contract the parties may reduce the period of limitation to not less than one year.
(2) A cause of action for default accrues when the act or omission on which the default or breach of warranty is based is or should have been discovered by the aggrieved party, or when the default occurs, whichever is later. A cause of action for indemnity accrues (a) in the case of an indemnity against liability, when the act or omission on which the claim for indemnity is based is or should have been discovered by the indemnified party, or when the default occurs, whichever is later, (b) in the case of an indemnity against loss or damage, when the person indemnified makes payment thereof. A cause of action for damages for injury to the person in the case of consumer goods accrues when the injury occurs.
(3) If an action commenced within the time limited by subsection (1) is so terminated as to leave available a remedy by another action for the same default or breach of warranty or indemnity, the other action may be commenced after the expiration of the time limited and within 6 months after the termination of the first action unless the termination resulted from voluntary discontinuance or from dismissal for failure or neglect to prosecute.
(4) This section does not alter the law on tolling of the statute of limitations nor does it apply to causes of action that have accrued before this article becomes effective.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §506.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division A - In General. › Section 7-2A-507 - Proof of Market Rent: Time and Place.

Section 7-2A-507
Proof of market rent: Time and place.
(1) Damages based on market rent (Section 7-2A-519 or 7-2A-528) are determined according to the rent for the use of the goods concerned for a lease term identical to the remaining lease term of the original lease agreement and prevailing at the times specified in Sections 7-2A-519 and 7-2A-528.
(2) If evidence of rent for the use of the goods concerned for a lease term identical to the remaining lease term of the original lease agreement and prevailing at the times or places described in this article is not readily available, the rent prevailing within any reasonable time before or after the time described or at any other place or for a different lease term which in commercial judgment or under usage of trade would serve as a reasonable substitute for the one described may be used, making any proper allowance for the difference, including the cost of transporting the goods to or from the other place.
(3) Evidence of a relevant rent prevailing at a time or place or for a lease term other than the one described in this article offered by one party is not admissible unless and until he or she has given the other party notice the court finds sufficient to prevent unfair surprise.
(4) If the prevailing rent or value of any goods regularly leased in any established market is in issue, reports in official publications or trade journals or in newspapers or periodicals of general circulation published as the reports of that market are admissible in evidence. The circumstances of the preparation of the report may be shown to affect its weight but not its admissibility.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §507.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-508 - Lessee's Remedies.

Section 7-2A-508
Lessee's remedies.
(1) If a lessor fails to deliver the goods in conformity to the lease contract (Section 7-2A-509) or repudiates the lease contract (Section 7-2A-402), or a lessee rightfully rejects the goods (Section 7-2A-509) or justifiably revokes acceptance of the goods (Section 7-2A-517), then with respect to any goods involved, and with respect to all of the goods if under an installment lease contract the value of the whole lease contract is substantially impaired (Section 7-2A-510), the lessor is in default under the lease contract and the lessee may:
(a) cancel the lease contract (Section 7-2A-505(1));
(b) recover so much of the rent and security as has been paid and is just under the circumstances;
(c) cover and recover damages as to all goods affected whether or not they have been identified to the lease contract (Sections 7-2A-518 and 7-2A-520), or recover damages for nondelivery (Sections 7-2A-519 and 7-2A-520);
(d) exercise any other rights or pursue any other remedies provided in the lease contract.
(2) If a lessor fails to deliver the goods in conformity to the lease contract or repudiates the lease contract, the lessee may also:
(a) if the goods have been identified, recover them (Section 7-2A-522); or
(b) in a proper case, obtain specific performance or replevy the goods (Section 7-2A-521).
(3) If a lessor is otherwise in default under a lease contract, the lessee may exercise the rights and pursue the remedies provided in the lease contract, which may include a right to cancel the lease, and in Section 7-2A-519(3).
(4) If a lessor has breached a warranty, whether express or implied, the lessee may recover damages (Section 7-2A-519(4)).
(5) On rightful rejection or justifiable revocation of acceptance, a lessee has a security interest in goods in the lessee's possession or control for any rent and security that has been paid and any expenses reasonably incurred in their inspection, receipt, transportation, and care and custody and may hold those goods and dispose of them in good faith and in a commercially reasonable manner, subject to Section 7-2A-527(5).
(6) Subject to the provisions of Section 7-2A-407, a lessee, on notifying the lessor of the lessee's intention to do so, may deduct all or any part of the damages resulting from any default under the lease contract from any part of the rent still due under the same lease contract.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §508.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-509 - Lessee's Rights on Improper Delivery; Rightful Rejection.

Section 7-2A-509
Lessee's rights on improper delivery; rightful rejection.
(1) Subject to the provisions of Section 7-2A-510 on default in installment lease contracts, if the goods or the tender or delivery fail in any respect to conform to the lease contract, the lessee may reject or accept the goods or accept any commercial unit or units and reject the rest of the goods.
(2) Rejection of goods is ineffective unless it is within a reasonable time after tender or delivery of the goods and the lessee seasonably notifies the lessor.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §509.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-510 - Installment Lease Contracts: Rejection and Default.

Section 7-2A-510
Installment lease contracts: Rejection and default.
(1) Under an installment lease contract a lessee may reject any delivery that is nonconforming if the nonconformity substantially impairs the value of that delivery and cannot be cured or the nonconformity is a defect in the required documents; but if the nonconformity does not fall within subsection (2) and the lessor or the supplier gives adequate assurance of its cure, the lessee must accept that delivery.
(2) Whenever nonconformity or default with respect to one or more deliveries substantially impairs the value of the installment lease contract as a whole there is a default with respect to the whole. But, the aggrieved party reinstates the installment lease contract as a whole if the aggrieved party accepts a nonconforming delivery without seasonably notifying of cancellation or brings an action with respect only to past deliveries or demands performance as to future deliveries.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §510.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-511 - Merchant Lessee's Duties as to Rightfully Rejected Goods.

Section 7-2A-511
Merchant lessee's duties as to rightfully rejected goods.
(1) Subject to any security interest of a lessee (Section 7-2A-508(5)), if a lessor or a supplier has no agent or place of business at the market of rejection, a merchant lessee, after rejection of goods in his or her possession or control, shall follow any reasonable instructions received from the lessor or the supplier with respect to the goods. In the absence of those instructions, a merchant lessee shall make reasonable efforts to sell, lease, or otherwise dispose of the goods for the lessor's account if they threaten to decline in value speedily. Instructions are not reasonable if on demand indemnity for expenses is not forthcoming.
(2) If a merchant lessee (subsection (1)) or any other lessee (Section 7-2A-512) disposes of goods, he or she is entitled to reimbursement either from the lessor or the supplier or out of the proceeds for reasonable expenses of caring for and disposing of the goods and, if the expenses include no disposition commission, to such commission as is usual in the trade, or if there is none, to a reasonable sum not exceeding 10 percent of the gross proceeds.
(3) In complying with this section or Section 7-2A-512, the lessee is held only to good faith. Good faith conduct hereunder is neither acceptance or conversion nor the basis of an action for damages.
(4) A purchaser who purchases in good faith from a lessee pursuant to this section or Section 7-2A-512 takes the goods free of any rights of the lessor and the supplier even though the lessee fails to comply with one or more of the requirements of this article.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §511.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-512 - Lessee's Duties as to Rightfully Rejected Goods.

Section 7-2A-512
Lessee's duties as to rightfully rejected goods.
(1) Except as otherwise provided with respect to goods that threaten to decline in value speedily (Section 7-2A-511) and subject to any security interest of a lessee (Section 7-2A-508(5)):
(a) the lessee, after rejection of goods in the lessee's possession, shall hold them with reasonable care at the lessor's or the supplier's disposition for a reasonable time after the lessee's seasonable notification of rejection;
(b) if the lessor or the supplier gives no instructions within a reasonable time after notification of rejection, the lessee may store the rejected goods for the lessor's or the supplier's account or ship them to the lessor or the supplier or dispose of them for the lessor's or the supplier's account with reimbursement in the manner provided in Section 7-2A-511; but
(c) the lessee has no further obligations with regard to goods rightfully rejected.
(2) Action by the lessee pursuant to subsection (1) is not acceptance or conversion.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §512.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-513 - Cure by Lessor of Improper Tender or Delivery; Replacement.

Section 7-2A-513
Cure by lessor of improper tender or delivery; replacement.
(1) If any tender or delivery by the lessor or the supplier is rejected because it is nonconforming and the time for performance has not yet expired, the lessor or the supplier may seasonably notify the lessee of the lessor's or the supplier's intention to cure and may then make a conforming delivery within the time provided in the lease contract.
(2) If the lessee rejects a nonconforming tender that the lessor or the supplier had reasonable grounds to believe would be acceptable with or without money allowance, the lessor or the supplier may have a further reasonable time to substitute a conforming tender if he or she seasonably notifies the lessee.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §513.)
2023 Code of Alabama › Title 7 - Commercial Code. › Article 2A - Leases. › Part 5 - Default. › Division B - Default by Lessor. › Section 7-2A-514 - Waiver of Lessee's Objections.

Section 7-2A-514
Waiver of lessee's objections.
(1) In rejecting goods, a lessee's failure to state a particular defect that is ascertainable by reasonable inspection precludes the lessee from relying on the defect to justify rejection or to establish default:
(a) if, stated seasonably, the lessor or the supplier could have cured it (Section 7-2A-513); or
(b) between merchants if the lessor or the supplier after rejection has made a request in writing for a full and final written statement of all defects on which the lessee proposes to rely.
(2) A lessee's failure to reserve rights when paying rent or other consideration against documents precludes recovery of the payment for defects apparent in the documents.
(Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §514; Act 2004-315, p. 464, §2.)