Okla. Stat. tit. 12A § 2A-219

Current through Laws 2024, c. 453.

Section 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 29 of this act), 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 paragraph (a) or (b) of this subsection, 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.

Okla. Stat. tit. 12A, § 2A-219

Added by Laws 1988, HB 1683, c. 86, § 28, eff. 11/1/1988.

Oklahoma Code Comment

Except in a finance lease ( § 2A-103(1)(g)), and except as otherwise agreed, risk of loss in the absence of default by the other party remains with the lessor. This probably reflects prior Oklahoma law. 15 Oklahoma Statutes §§538(2) and 539(4) (repealed by H.B.1683) provided that a bailment for hire terminated when the greater part, or that part which was the material inducement to the lessee, of the thing hired perished from a cause other than the negligence of the lessee, or was destroyed. 15 Oklahoma Statutes § 545 (also repealed), which seemed to absolutely require return of the personal property hired, should be read as consistent with the earlier sections, and thus as consistent with this section of Article 2A. Then, too, in the sales area, absent agreement, prior Oklahoma law allocated risk of loss on the basis of title, and the result of that approach generally is consistent with the rule of this section. See Oklahoma Code Comment to 12A Oklahoma Statutes § 2-509.

When one of the parties to the lease is in default, risk of loss is governed instead by § 2A-220 and essentially is allocated to the defaulting party. This approach appears consistent with that of 15 Oklahoma Statutes § 536 (repealed), and with that of 15 Oklahoma Statutes § 456, which provides that a bailee is responsible for any damage to the thing bailed during wrongful use of the goods unless the damage was inevitable.

Loss or damage due to the negligence of the lessee where the risk of loss remains on the lessor is to be distinguished. Article 2A treats any obligation of the lessee to care for the leased goods as an aspect of the lessor's reversionary rights which Article 2A, except in a few instances and in the absence of agreement, leaves to law outside the UCC as a part of the general law of property or other applicable law. See 12A Oklahoma Statutes § 1-103 and Official Comment to § 2A-525. But see § 2A-532. In the absence of agreement therefore, the lessee must under 15 Oklahoma Statutes § 466 exercise ordinary care. See Kesterson & Telle v. Marlow, 161 P. 186 (Okla.1917), involving a rented piano. In some instances under other law a greater duty may be involved. See 15 Oklahoma Statutes § 464. However, it would appear that a higher, but not a lesser, degree of care may be provided by the agreement of the parties. See Chambers v. Morgan, 671 P.2d 89 (Okla App. 1983); Oklahoma Petroleum & Gasoline Co. v. Winship, 200 P. 844 (Okla.1921); and Scott Auto & Supply Co. v. McQueen, 226 P. 372 (Okla.1924). In any event, for certainty the lease agreement should stipulate the condition of the goods to be returned to the lessor and the lessee's duty with respect to them during the term of the lease.

The 1991 amendments make no specific chance here.