2012 Pennsylvania Consolidated Statutes
Title 13 - COMMERCIAL CODE
Chapter 2A3 - Effect of Lease Contract
Section 2A303 - Alienability of party's interest under lease contract or of lessor's residual interest in goods; delegation of performance; transfer of rights

     § 2A303.  Alienability of party's interest under lease contract
                or of lessor's residual interest in goods; delegation
                of performance; transfer of rights.
        (a)  Definition.--As used in this section, the term "creation
     of a security interest" includes the sale of a lease contract
     that is subject to Division 9 (relating to secured transactions)
     by reason of section 9109(a)(3) (relating to scope).
        (b)  General rule.--Except as provided in subsection (c) and
     section 9407 (relating to restrictions on creation or
     enforcement of security interest in leasehold interest or in
     lessor's residual interest), a provision in a lease agreement
     which:
            (1)  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
            (2)  makes such a transfer an event of default;
     gives rise to the rights and remedies provided in subsection
     (d), but a transfer that is prohibited or is an event of default
     under the lease agreement is otherwise effective.
        (c)  Transfer of right to damages.--A provision in a lease
     agreement which:
            (1)  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
            (2)  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 (d).
        (d)  Certain rights and remedies.--Subject to subsection (c)
     and section 9407:
            (1)  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 2A501(b) (relating to default:
        procedure).
            (2)  If paragraph (1) is not applicable and if a transfer
        is made that is prohibited under a lease agreement or
        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, 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 a court having jurisdiction may grant other
        appropriate relief, including cancellation of the lease
        contract or an injunction against the transfer.
        (e)  Effect and enforceability of general transfer.--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.
        (f)  Effect of delegation of performance.--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 any liability for default.
        (g)  Requirements for prohibition of transfer in consumer
     lease.--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.
     (June 8, 2001, P.L.123, No.18, eff. July 1, 2001)

        2001 Amendment.  Act 18 amended subsecs. (a) and (b), deleted
     subsec. (c), amended and relettered subsec. (d) to subsec. (c),
     amended and relettered subsec. (e) to subsec. (d), relettered
     subsec. (f) to subsec. (e), subsec. (g) to subsec. (f) and
     subsec. (h) to subsec. (g) and amended subsec. (h) heading.
        Cross References.  Section 2A303 is referred to in sections
     2A304, 2A305, 9406, 9407 of this title.