CHAPTER 743aa
CONSUMER LEASES

PART I
SHORT TITLE. DEFINITIONS. GENERAL PROVISIONS

      Sec. 42-391. Definitions. (a) In sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive:

      (1) "Conspicuous", with reference to a provision or statement, means so written, displayed or presented that a reasonable person against which it is to operate should have noticed it. Whether a provision or statement is conspicuous is a decision for the court. Conspicuous provisions or statements include the following:

      (A) A heading in capitals equal in size to or greater in size than the surrounding text, or in contrasting type, font or color to the surrounding text of the same or lesser size; and

      (B) Language in the body of a record or display in larger type than the surrounding text, or in contrasting type, font or color to the surrounding text of the same size, or set off from surrounding text of the same size by symbols or other marks that call attention to the language.

      (2) "Consumer lease" means a lease in which:

      (A) The lessee is obligated for a term of more than four months and for a total contractual obligation of one hundred fifty thousand dollars or less, excluding residual value, payments for options to renew or purchase and payments to persons other than the holder, whether or not the lessee has the option to purchase or otherwise become the owner of the goods at the expiration of the lease; and

      (B) When the lease is consummated, the goods are intended by the lessee primarily for personal, family or household purposes.

      (3) "Federal Consumer Leasing Act" means Chapter 5 of Title I of the Consumer Credit Protection Act, 15 USC Sections 1667 to 1667f, inclusive, as amended. The term includes regulations issued by the Board of Governors of the Federal Reserve System or the Bureau of Consumer Financial Protection pursuant to that act, Regulation M, 12 CFR Part 213, as amended.

      (4) "Good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing.

      (5) "Goods" means all things that are movable at the time of identification to a consumer lease, or are fixtures. The term does not include money, documents, letters of credit, letter-of-credit rights, instruments, investment property, accounts, chattel paper, deposit accounts, general intangibles or minerals or the like, including oil and gas, before extraction.

      (6) "Guarantor" means an individual who becomes obligated to perform as an additional obligor under a consumer lease because the original lessee either does not meet the lessor's credit standards or is in default under the lease. The term does not include:

      (A) An individual who agrees or requests to become obligated as a colessee; or

      (B) An assignor of a consumer lease.

      (7) "Holder" means a lessor or, if the lessor's interest is assigned, the assignee for the period of the assignee's ownership of the interest.

      (8) "Lease" means a transfer of the right to possession and use of goods for a period in return for consideration. The term does not include a sale on approval, a sale or return or another sale, or the retention or creation of a security interest. The term includes a sublease.

      (9) "Lessee" means an individual who acquires, applies for, or is offered the right to possession and use of goods under a consumer lease. The term includes a legal representative of, fiduciary for or successor in interest to, an individual who is a lessee, but does not include a guarantor on a consumer lease.

      (10) "Lessor" means a person that transfers the right to possession and use of goods under a consumer lease.

      (11) "Motor vehicle" means a vehicle required by law to be registered under section 14-12.

      (12) "Open-end consumer lease" means a consumer lease in which the lessee's liability at the expiration of the lease is based on the difference between the residual value and the realized value of the leased goods.

      (13) "Realized value" means a valuation of the goods at the time the holder assesses liability on the lessee in connection with termination of the lease, as determined under section 42-420.

      (14) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

      (15) "Sign" means:

      (A) To execute or adopt a tangible symbol with the present intent to authenticate a record; or

      (B) To attach or logically associate an electronic symbol, sound or process to or with a record with the present intent to authenticate a record.

      (16) "State" means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States.

      (b) The following terms used in sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive, have the meanings ascribed in the Uniform Commercial Code:

        "Accession". Section 42a-9-102(a).
        "Agreement". Section 42a-1-201(b).
        "Contract". Section 42a-1-201(b).
        "Investment property". Section 42a-9-102(a).
        "Money". Section 42a-1-201(b).
        "Person". Section 42a-1-201(b).
        "Person related to". Section 42a-9-102(a).
        "Security interest". Section 42a-1-201(b).
        "Send". Section 42a-1-201(b).

      (c) The following terms used in sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive, have the meanings ascribed in the federal Consumer Leasing Act:

      (1) "Adjusted capitalized cost";

      (2) "Capitalized cost reduction";

      (3) "Gross capitalized cost";

      (4) "Rent charge"; and

      (5) "Residual value".

      (P.A. 02-81, S. 2; P.A. 05-109, S. 53; P.A. 11-110, S. 12.)

      History: P.A. 02-81 effective July 1, 2003; P.A. 05-109 amended Subsec. (b) by replacing references to various subdivisions of Sec. 42a-1-201 with "Section 42a-1-201(b)"; P.A. 11-110 amended Subsec. (a)(3) to add reference to Bureau of Consumer Financial Protection, effective July 21, 2011.

PART V
PENALTIES. ENFORCEMENT. ADMINISTRATION

      Sec. 42-427. Limitations on private remedies. (a) A holder is not liable for statutory damages under subsection (d) of section 42-424 if, within sixty days after discovering a violation of sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive, and before commencement of an action under section 42-424 or the receipt of written notice of the violation from the lessee, the holder notifies the lessee concerned and corrects the violation, including refund, restitution or crediting of any charges improperly disclosed or imposed.

      (b) A holder is not liable for statutory damages under subsection (d) of section 42-424 if the holder proves by a preponderance of the evidence that the violation was unintentional and resulted from an error in good faith notwithstanding the maintenance of procedures reasonably adapted to avoid the error. For purposes of this subsection, errors in good faith include clerical errors, calculation errors, computer malfunctions and programming errors, but an error of legal judgment with respect to a holder's obligations under sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive, is not a good faith error.

      (c) There may be no more than one recovery of statutory damages under subsection (d) of section 42-424 for a violation of sections 42-425 to 42-431, inclusive, regardless of the number of lessees in the consumer lease.

      (d) Liability does not arise under sections 42-424 to 42-431, inclusive, with respect to an act or omission in good faith conforming to:

      (1) A rule or interpretation of sections 42-270 to 42-271a, inclusive, and 42-390 to 42-434, inclusive, or to an approval by the Commissioner of Consumer Protection, even if after the act or omission occurred, the rule, interpretation or approval is amended, rescinded or determined by judicial or other authority to be invalid; or

      (2) With respect to requirements based on the federal Consumer Leasing Act, a rule, regulation or interpretation of said act by the Federal Reserve Board or the Bureau of Consumer Financial Protection, even if after the act or omission occurred, the rule, regulation or interpretation is amended, rescinded or determined by judicial or other authority to be invalid.

      (e) Regardless of the number of violations resulting from a holder's multiple failures to comply with the provisions enumerated in subsection (d) of section 42-424 with respect to a single consumer lease, the lessee is entitled to a single recovery of statutory damages under sections 42-424 to 42-431, inclusive, but continued failure to comply after a recovery has been granted gives rise to rights to additional recoveries.

      (P.A. 02-81, S. 38; June 30 Sp. Sess. P.A. 03-6, S. 146(c); P.A. 04-189, S. 1; P.A. 11-110, S. 13.)

      History: P.A. 02-81 effective July 1, 2003; June 30 Sp. Sess. P.A. 03-6 replaced Commissioner of Consumer Protection with Commissioner of Agriculture and Consumer Protection, effective July 1, 2004; P.A. 04-189 repealed Sec. 146 of June 30 Sp. Sess. P.A. 03-6, thereby reversing the merger of the Departments of Agriculture and Consumer Protection, effective June 1, 2004; P.A. 11-110 amended Subsec. (d)(2) to add reference to Bureau of Consumer Financial Protection, effective July 21, 2011.