(13) Further, it has become the only state to impose unlimited liability for lessee negligence on lessors
. (14) The other two states which had unlimited lessor
liability, Connecticut and Rhode Island, have passed statutes capping lessor
liability within the last few years because vehicle financing companies threatened to stop leasing in those states unless their liability was removed or limited.
The loss payable clause also has a warning for the lessor
. If the loss to the car results from fraudulent acts or omissions on the part of the named insured, CA 20 01 declares that the interest of the lessor
is not covered.
The most important decision you make is which lessor
you choose for the transaction.
* The lessor
owns the car, unless the lessee options to buy it at the end-of-term or refinances the remaining amount.
An experienced lessor
with a sound infrastructure can offer other solutions which specifically address the technology issue.
Setting the price isn't an exact science, and both the lessee and the lessor
are exposed to potential risks.
The present value of lease rentals which the lessor
will receive from the lessee does not exceed 90 per cent of the fair value of the asset.
Tax-related factors were not found to be important in explaining the level of leasing by a firm.(2) Vora and Ezzell (1991) found significant tax rate differences between lessees and lessors
, although they found that the lessee's tax rate is not necessarily lower than the respective lessor
Meanwhile, for lessors
, the accounting aspect for leases did not differ greatly.
The Law is, in many respects, quite prescriptive as to the components that should be included in a Finance Lease contract and, unless otherwise agreed in the Finance Lease contract, the rights and obligations of the lessor
and the lessee.
First, the lessor
must first make a written demand for the lessee: (1) to pay or comply with the conditions of the lease; and (2) to vacate the premises.
A lessee files for bankruptcy protection, continues to use equipment subject to a lease, but does so without making payments (or without making the full contract-rate payment) to the lessor
during the limbo period.