Tex. Bus. & Com. Code Section 2A.303
Alienability of Party’s Interest Under Lease Contract or of Lessor’s Residual Interest in Goods; Delegation of Performance; Transfer of Rights


(a)

As used in this section, “creation of a security interest” includes the sale of a lease contract that is subject to Chapter 9 (Applicability of Law to Commercial Transactions) of this code, Secured Transactions, by reason of Section 9.109 (Scope)(a)(3).

(b)

Except as provided in Section 9.407 (Restrictions on Creation or Enforcement of Security Interest in Leasehold Interest or in Lessor’s Residual Interest)(c), 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)

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)

Subject to Section 9.407 (Restrictions on Creation or Enforcement of Security Interest in Leasehold Interest or in Lessor’s Residual Interest)(c):

(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 2A.501 (Default: Procedure)(b); and

(2)

if Subdivision (1) is not applicable and if a transfer is made that (A) is prohibited under a lease agreement or (B) materially impairs the prospect of obtaining return performance by, materially changes the duty of, or materially increases the burden of 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, (i) 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 (ii) a court having jurisdiction may grant other appropriate relief, including cancellation of the lease contract or an injunction against the transfer.

(e)

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. This promise is enforceable by either the transferor or the other party to the lease contract.

(f)

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 of any liability for default.

(g)

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.
Added by Acts 1993, 73rd Leg., ch. 570, Sec. 1, eff. Sept. 1, 1993. Amended by Acts 1999, 76th Leg., ch. 414, Sec. 2.20, eff. July 1, 2001.

Source: Section 2A.303 — Alienability of Party's Interest Under Lease Contract or of Lessor's Residual Interest in Goods; Delegation of Performance; Transfer of Rights, https://statutes.­capitol.­texas.­gov/Docs/BC/htm/BC.­2A.­htm#2A.­303 (accessed Mar. 23, 2024).

2A.101
Short Title
2A.102
Scope
2A.103
Definitions and Index of Definitions
2A.104
Leases Subject to Other Laws
2A.105
Territorial Application of Chapter to Goods Covered by Certificate of Title
2A.106
Limitation on Power of Parties to Consumer Lease to Choose Applicable Law and Judicial Forum
2A.107
Waiver or Renunciation of Claim or Right After Default
2A.108
Unconscionability
2A.109
Option to Accelerate at Will
2A.201
Statute of Frauds
2A.202
Final Written Expression
2A.203
Seals Inoperative
2A.204
Formation in General
2A.205
Firm Offers
2A.206
Offer and Acceptance in Formation of Lease Contract
2A.208
Modification, Rescission and Waiver
2A.209
Lessee Under Finance Lease as Beneficiary of Supply Contract
2A.210
Express Warranties
2A.211
Warranties Against Interference and Against Infringement
2A.212
Implied Warranty of Merchantability
2A.213
Implied Warranty of Fitness for Particular Purpose
2A.214
Exclusion or Modification of Warranties
2A.215
Accumulation and Conflict of Warranties Express or Implied
2A.216
Third-party Beneficiaries of Express and Implied Warranties
2A.217
Identification
2A.218
Insurance and Proceeds
2A.219
Risk of Loss
2A.220
Effect of Default on Risk of Loss
2A.221
Casualty to Identified Goods
2A.301
Enforceability of Lease Contract
2A.302
Title to and Possession of Goods
2A.303
Alienability of Party’s Interest Under Lease Contract or of Lessor’s Residual Interest in Goods
2A.304
Subsequent Lease of Goods by Lessor
2A.305
Sale or Sublease of Goods by Lessee
2A.306
Priority of Certain Liens Arising by Operation of Law
2A.307
Priority of Liens Arising by Attachment or Levy On, Security Interests In, and Other Claims to Goods
2A.308
Special Rights of Creditors
2A.309
Lessor’s and Lessee’s Rights When Goods Become Fixtures
2A.310
Lessor’s and Lessee’s Rights When Goods Become Accessions
2A.401
Insecurity: Adequate Assurance of Performance
2A.402
Anticipatory Repudiation
2A.403
Retraction of Anticipatory Repudiation
2A.404
Substituted Performance
2A.405
Excused Performance
2A.406
Procedure on Excused Performance
2A.407
Irrevocable Promises: Finance Leases
2A.501
Default: Procedure
2A.502
Notice After Default
2A.503
Modification or Impairment of Rights and Remedies
2A.504
Liquidation of Damages
2A.505
Cancellation and Termination and Effect of Cancellation, Termination, Rescission, or Fraud on Rights and Remedies
2A.506
Statute of Limitations
2A.507
Proof of Market Rent
2A.508
Lessee’s Remedies
2A.509
Lessee’s Rights on Improper Delivery
2A.510
Installment Lease Contracts: Rejection and Default
2A.511
Merchant Lessee’s Duties as to Rightfully Rejected Goods
2A.512
Lessee’s Duties as to Rightfully Rejected Goods
2A.513
Cure by Lessor of Improper Tender or Delivery
2A.514
Waiver of Lessee’s Objections
2A.515
Acceptance of Goods
2A.516
Effect of Acceptance of Goods
2A.517
Revocation of Acceptance of Goods
2A.518
Cover
2A.519
Lessee’s Damages for Nondelivery, Repudiation, Default, and Breach of Warranty in Regard to Accepted Goods
2A.520
Lessee’s Incidental and Consequential Damages
2A.521
Lessee’s Right to Specific Performance, Replevin, and Other Remedies
2A.522
Lessee’s Right to Goods on Lessor’s Insolvency
2A.523
Lessor’s Remedies
2A.524
Lessor’s Right to Identify Goods to Lease Contract
2A.525
Lessor’s Right to Possession of Goods
2A.526
Lessor’s Stoppage of Delivery in Transit or Otherwise
2A.527
Lessor’s Rights to Dispose of Goods
2A.528
Lessor’s Damages for Nonacceptance, Failure to Pay, Repudiation, or Other Default
2A.529
Lessor’s Action for the Rent
2A.530
Lessor’s Incidental Damages
2A.531
Standing to Sue Third Parties for Injury to Goods
2A.532
Lessor’s Rights to Residual Interest

Accessed:
Mar. 23, 2024

§ 2A.303’s source at texas​.gov