2007 Minnesota Statutes

336.2A-305 SALE OR SUBLEASE OF GOODS BY LESSEE.
(1) Subject to the provisions of section 336.2A-303, a buyer or sublessee from the lessee
of goods under an existing lease contract obtains, to the extent of the interest transferred, the
leasehold interest in the goods that the lessee had or had power to transfer, and except as provided
in subsection (2) and section 336.2A-511(4), takes subject to the existing lease contract. A lessee
with a voidable leasehold interest has power to transfer a good leasehold interest to a good
faith buyer for value or a good faith sublessee for value, but only to the extent set forth in the
preceding sentence. When goods have been delivered under a transaction of lease the lessee
has that power even though:
(a) the lessor was deceived as to the identity of the lessee;
(b) the delivery was in exchange for a check which is later dishonored; or
(c) the delivery was procured through fraud punishable as larcenous under the criminal law.
(2) A buyer in the ordinary course of business or a sublessee in the ordinary course of
business from a lessee who is a merchant dealing in goods of that kind to whom the goods were
entrusted by the lessor obtains, to the extent of the interest transferred, all of the lessor's and
lessee's rights to the goods, and takes free of the existing lease contract.
(3) A buyer or sublessee from the lessee of goods that are subject to an existing lease contract
and are covered by a certificate of title issued under a statute of this state or of another jurisdiction
takes no greater rights than those provided both by this section and by the certificate of title statute.
History: 1989 c 232 art 1 s 2A-305