(a) If either party repudiates a lease contract, other than a consumer lease, 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:

(1) For a commercially reasonable time, await retraction of repudiation and performance by the repudiating party;

Terms Used In California Commercial Code 10402

  • Aggrieved party: means a party entitled to pursue a remedy. See California Commercial Code 1201
  • 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 California Commercial Code 10103
  • contract: means the bargain of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in Section 1303. See California Commercial Code 1201
  • Contract: A legal written agreement that becomes binding when signed.
  • Goods: means all things that are movable at the time of identification to the lease contract, or are fixtures (Section 10309), but the term does not include money, documents, instruments, accounts, chattel paper, general intangibles, or minerals or the like, including oil and gas, before extraction. See California Commercial Code 10103
  • Lease: means a transfer of the right to possession and use of goods for a term in return for consideration, but a sale, including a sale on approval or a sale or return, or retention or creation of a security interest is not a lease. See California Commercial Code 10103
  • 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 contract: means the total legal obligation that results from the lease agreement as affected by this division and any other applicable rules of law. See California Commercial Code 10103
  • Lessor: means a person who transfers the right to possession and use of goods under a lease. See California Commercial Code 10103
  • Remedy: means any remedial right to which an aggrieved party is entitled with or without resort to a tribunal. See California Commercial Code 1201
  • Right: includes remedy. See California Commercial Code 1201

(2) Make demand pursuant to Section 10401 and await assurance of future performance adequate under the circumstances of the particular case; or

(3) Resort to any right or remedy upon default under the lease contract or this division, 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. 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 division on the lessor’s right to identify goods to the lease contract notwithstanding default or to salvage unfinished goods (Section 10524).

(b) The rights and remedies of the parties to a consumer lease in connection with a repudiation of that lease shall be determined under other laws, and this section shall not affect the applicability or interpretation of those laws.

(Amended by Stats. 1991, Ch. 111, Sec. 34. Effective July 15, 1991.)

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