California Commercial Code 10517 – (a) A lessee may revoke acceptance of a lot or commercial unit …
(a) A lessee may revoke acceptance of a lot or commercial unit whose nonconformity substantially impairs its value to the lessee if the lessee has accepted it:
(1) Except in the case of a finance lease, on the reasonable assumption that its nonconformity would be cured and it has not been seasonably cured; or
Terms Used In California Commercial Code 10517
- Commercial unit: means such a unit of goods as by commercial usage is a single whole for purposes of lease and division of which materially impairs its character or value on the market or in use. See California Commercial Code 10103
- Discovery: Lawyers' examination, before trial, of facts and documents in possession of the opponents to help the lawyers prepare for trial.
- Finance lease: means a lease with respect to which (A) the lessor does not select, manufacture, or supply the goods, (B) the lessor acquires the goods or the right to possession and use of the goods in connection with the lease, and (C) one of the following occurs:
California Commercial Code 10103
- 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: 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: 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 agreement: means the bargain, with respect to the lease, of the lessor and the lessee in fact as found in their language or by implication from other circumstances including course of dealing or usage of trade or course of performance as provided in this division. See California Commercial Code 10103
- Lessee: means a person who acquires the right to possession and use of goods under a lease. 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
- Lot: means a parcel or a single article that is the subject matter of a separate lease or delivery, whether or not it is sufficient to perform the lease contract. See California Commercial Code 10103
(2) Without discovery of the nonconformity if the lessee’s acceptance was reasonably induced either by the lessor‘s assurances or, except in the case of a finance lease, by the difficulty of discovery before acceptance.
(b) A lessee may revoke acceptance of a lot or commercial unit if the lessor defaults under the lease contract and the default substantially impairs the value of that lot or commercial unit to the lessee.
(c) If the lease agreement so provides, the lessee may revoke acceptance of a lot or commercial unit because of other defaults by the lessor.
(d) Revocation of acceptance must occur within a reasonable time after the lessee discovers or should have discovered the ground for it and before any substantial change in condition of the goods which is not caused by the nonconformity. Revocation is not effective until the lessee notifies the lessor.
(e) A lessee who so revokes has the same rights and duties with regard to the goods involved as if the lessee had rejected them.
(Amended by Stats. 1991, Ch. 111, Sec. 55. Effective July 15, 1991.)