47-2A504. Liquidation of damages
A. Damages payable by either party for default, or any other act or omission,
including indemnity for loss or diminution of anticipated tax benefits or loss or damage
to lessor's residual interest, may be liquidated in the lease agreement but only at an
amount or by a formula that is reasonable in light of the then anticipated harm caused by
the default or other act or omission.
B. If the lease agreement provides for liquidation of damages, and such provision
does not comply with subsection A of this section, or such provision is an exclusive or
limited remedy that circumstances cause to fail of its essential purpose, remedy may be
had as provided in this Article.
C. If the lessor justifiably withholds or stops delivery of goods because of the
lessee's default or insolvency (section 47-2A525 or 47-2A526), the lessee is entitled to
restitution of any amount by which the sum of his payments exceeds:
1. The amount to which the lessor is entitled by virtue of terms liquidating the
lessor's damages in accordance with subsection A of this section; or
2. In the absence of those terms, twenty per cent of the then present value of the
total rent the lessee was obligated to pay for the balance of the lease term, or, in the
case of a consumer lease, the lesser of such amount or five hundred dollars.
D. A lessee's right to restitution under subsection C of this section is subject to
offset to the extent the lessor establishes:
1. A right to recover damages under the provisions of this chapter other than
subsection A of this section; and
2. The amount or value of any benefits received by the lessee directly or
indirectly by reason of the lease contract.
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