2-A-219 - Risk of Loss.

Section 2-A-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 2-A-220), 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), 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.