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(810 ILCS 5/Art.
2A Pt. 2 heading)
PART
2. FORMATION AND CONSTRUCTION OF LEASE CONTRACT
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(810 ILCS 5/2A-201) (from Ch. 26,
par. 2A-201)
Sec. 2A-201. Statute of frauds.
(1) A lease contract is not enforceable
by way of action or defense unless:
(a) the
total payments to be made under the lease
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contract, excluding payments for options
to renew or buy, are less than $1,000; or
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(b)
there is a writing, signed by the party against
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whom enforcement is sought or by that
party's authorized agent, sufficient to indicate
that a lease contract has been made between the
parties and to describe the goods leased and the
lease term.
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(2) Any description
of leased goods or of the lease term is sufficient and
satisfies subsection (1)(b), whether or not it is specific,
if it reasonably identifies what is described.
(3) A writing is not insufficient
because it omits or incorrectly states a term agreed upon, but
the lease contract is not enforceable under subsection (1)(b) beyond
the lease term and the quantity of goods shown in the writing.
(4) A lease contract that does
not satisfy the requirements of subsection (1), but which is valid
in other respects, is enforceable:
(a) if
the goods are to be specially manufactured or
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obtained for the lessee and are not
suitable for lease or sale to others in the ordinary
course of the lessor's business, and the lessor,
before notice of repudiation is received and under
circumstances that reasonably indicate that the
goods are for the lessee, has made either a substantial
beginning of their manufacture or commitments for
their procurement;
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(b)
if the party against whom enforcement is sought
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admits in that party's pleading, testimony,
or otherwise in court that a lease contract was
made, but the lease contract is not enforceable
under this provision beyond the quantity of goods
admitted; or
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(c)
with respect to goods that have been received
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and accepted by the lessee.
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(5) The lease
term under a lease contract referred to in subsection (4)
is:
(a) if
there is a writing signed by the party
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against whom enforcement is sought or
by that party's authorized agent specifying the
lease term, the term so specified;
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(b)
if the party against whom enforcement is sought
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admits in that party's pleading, testimony,
or otherwise in court a lease term, the term so
admitted; or
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(c)
a reasonable lease term.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-202) (from Ch. 26,
par. 2A-202)
Sec. 2A-202. Final written
expression; parol or extrinsic evidence. Terms with respect
to which the confirmatory memoranda of the parties agree or
which are otherwise set forth in a writing intended by the
parties as a final expression of their agreement with respect
to such terms as are included therein may not be contradicted
by evidence of any prior agreement or of a contemporaneous
oral agreement but may be explained or supplemented:
(a) by
course of dealing or usage of trade or by
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course of performance; and
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(b)
by evidence of consistent additional terms
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unless the court finds the writing to
have been intended also as a complete and exclusive
statement of the terms of the agreement.
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(Source: P.A. 87-493.)
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(810 ILCS 5/2A-203) (from Ch. 26,
par. 2A-203)
Sec. 2A-203. Seals inoperative.
The affixing of a seal to a writing evidencing a lease contract
or an offer to enter into a lease contract does not render
the writing a sealed instrument and the law with respect to
sealed instruments does not apply to the lease contract or
offer.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-204) (from Ch. 26,
par. 2A-204)
Sec. 2A-204. Formation in
general.
(1) A lease contract may be made
in any manner sufficient to show agreement, including conduct
by both parties which recognizes the existence of a lease contract.
(2) An agreement sufficient to
constitute a lease contract may be found although the moment
of its making is undetermined.
(3) Although one or more terms
are left open, a lease contract does not fail for indefiniteness
if the parties have intended to make a lease contract and there
is a reasonably certain basis for giving an appropriate remedy.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-205) (from Ch. 26,
par. 2A-205)
Sec. 2A-205. Firm offers.
An offer by a merchant to lease goods to or from another person
in a signed writing that by its terms gives assurance it will
be held open is not revocable, for lack of consideration, during
the time stated or, if no time is stated, for a reasonable
time, but in no event may the period of irrevocability exceed
3 months. Any such term of assurance on a form supplied by
the offeree must be separately signed by the offeror.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-206) (from Ch. 26,
par. 2A-206)
Sec. 2A-206. Offer and acceptance
in formation of lease contract.
(1) Unless otherwise unambiguously
indicated by the language or circumstances, an offer to make
a lease contract must be construed as inviting acceptance in
any manner and by any medium reasonable in the circumstances.
(2) If the beginning of a requested
performance is a reasonable mode of acceptance, an offeror who
is not notified of acceptance within a reasonable time may treat
the offer as having lapsed before acceptance.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-207) (from Ch. 26, par. 2A-207)
Sec. 2A-207. Course of performance
or practical construction.
(1) If a lease contract involves
repeated occasions for performance by either party with knowledge
of the nature of the performance and opportunity for objection
to it by the other, any course of performance accepted or acquiesced
in without objection is relevant to determine the meaning of
the lease agreement.
(2) The express terms of a lease
agreement and any course of performance, as well as any course
of dealing and usage of trade, must be construed whenever reasonable
as consistent with each other; but if that construction is unreasonable,
express terms control course of performance, course of performance
controls both course of dealing and usage of trade, and course
of dealing controls usage of trade.
(3) Subject to the provisions of
Section 2A-208 on modification and waiver, course of performance
is relevant to show a waiver or modification of any term inconsistent
with the course of performance.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-208) (from Ch. 26, par. 2A-208)
Sec. 2A-208. Modification,
rescission, and waiver.
(1) An agreement modifying a lease
contract needs no consideration to be binding.
(2) A signed lease agreement that
excludes modification or rescission except by a signed writing
may not be otherwise modified or rescinded, but, except as between
merchants, such a requirement on a form supplied by a merchant
must be separately signed by the other party.
(3) Although an attempt at modification
or rescission does not satisfy the requirements of subsection
(2), it may operate as a waiver.
(4) A party who has made a waiver
affecting an executory portion of a lease contract may retract
the waiver by reasonable notification received by the other party
that strict performance will be required of any term waived,
unless the retraction would be unjust in view of a material change
of position in reliance on the waiver.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-209) (from Ch. 26, par. 2A-209)
Sec. 2A-209. Lessee under
finance lease as beneficiary of supply contract.
(1) The benefit of a supplier's
promises to the lessor under the supply contract and of all warranties,
whether express or implied, including those of any third party
provided in connection with or as part of the supply contract,
extends to the lessee to the extent of the lessee's leasehold
interest under a finance lease related to the supply contract,
but is subject to the terms of the warranty and of the supply
contract and all defenses or claims arising therefrom.
(2) The extension of the benefit
of a supplier's promises and of warranties to the lessee (Section
2A-209(1)) does not: (i) modify the rights and obligations
of the parties to the supply contract, whether arising therefrom
or otherwise, or (ii) impose any duty or liability under the
supply contract on the lessee.
(3) Any modification or rescission
of the supply contract by the supplier and the lessor is effective
between the supplier and the lessee unless, before the modification
or rescission, the supplier has received notice that the lessee
has entered into a finance lease related to the supply contract.
If the modification or rescission is effective between the supplier
and the lessee, the lessor is deemed to have assumed, in addition
to the obligations of the lessor to the lessee under the lease
contract, promises of the supplier to the lessor and warranties
that were so modified or rescinded as they existed and were available
to the lessee before modification or rescission.
(4) In addition to the extension
of the benefit of the supplier's promises and of warranties to
the lessee under subsection (1), the lessee retains all rights
that the lessee may have against the supplier which arise from
an agreement between the lessee and the supplier or under other
law.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-210) (from Ch. 26, par. 2A-210)
Sec. 2A-210. Express warranties.
(1) Express warranties by the lessor
are created as follows:
(a) Any
affirmation of fact or promise made by the
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lessor to the lessee which relates to
the goods and becomes part of the basis of the
bargain creates an express warranty that the goods
will conform to the affirmation or promise.
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(b)
Any description of the goods which is made part
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of the basis of the bargain creates
an express warranty that the goods will conform
to the description.
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(c)
Any sample or model that is made part of the
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basis of the bargain creates an express
warranty that the whole of the goods will conform
to the sample or model.
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(2) It is not
necessary to the creation of an express warranty that the
lessor use formal words, such as "warrant" or "guarantee",
or that the lessor have a specific intention to make a
warranty, but an affirmation merely of the value of the
goods or a statement purporting to be merely the lessor's
opinion or commendation of the goods does not create a
warranty.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-211) (from Ch. 26, par. 2A-211)
Sec. 2A-211. Warranties against
interference and against infringement; lessee's obligation
against infringement.
(1) There is in a lease contract
a warranty that for the lease term no person holds a claim to
or interest in the goods that arose from an act or omission of
the lessor, other than a claim by way of infringement or the
like, which will interfere with the lessee's enjoyment of its
leasehold interest.
(2) Except in a finance lease,
there is in a lease contract by a lessor who is a merchant regularly
dealing in goods of the kind a warranty that the goods are delivered
free of the rightful claim of any person by way of infringement
or the like.
(3) A lessee who furnishes specifications
to a lessor or a supplier shall hold the lessor and the supplier
harmless against any claim by way of infringement or the like
that arises out of compliance with the specifications.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-212) (from Ch. 26, par. 2A-212)
Sec. 2A-212. Implied warranty
of merchantability.
(1) Except in a finance lease,
a warranty that the goods will be merchantable is implied in
a lease contract if the lessor is a merchant with respect to
goods of that kind.
(2) Goods to be merchantable must
be at least such as:
(a) pass
without objection in the trade under the
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description in the lease agreement;
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(b)
in the case of fungible goods, are of fair
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average quality within the description;
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(c)
are fit for the ordinary purposes for which
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goods of that type are used;
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(d)
run, within the variation permitted by the lease
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agreement, of even kind, quality, and
quantity within each unit and among all units involved;
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(e)
are adequately contained, packaged, and labeled
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as the lease agreement may require;
and
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(f)
conform to any promises or affirmations of fact
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made on the container or label.
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(3) Other implied
warranties may arise from course of dealing or usage of
trade.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-213) (from Ch. 26, par. 2A-213)
Sec. 2A-213. Implied warranty
of fitness for particular purpose. Except in a finance lease,
if the lessor at the time the lease contract is made has reason
to know of any particular purpose for which the goods are required
and that the lessee is relying on the lessor's skill or judgment
to select or furnish suitable goods, there is in the lease
contract an implied warranty that the goods will be fit for
that purpose.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-214) (from Ch. 26, par. 2A-214)
Sec. 2A-214. Exclusion or
modification of warranties.
(1) Words or conduct relevant to
the creation of an express warranty and words or conduct tending
to negate or limit a warranty must be construed wherever reasonable
as consistent with each other; but, subject to the provisions
of Section 2A-202 on parol or extrinsic evidence, negation
or limitation is inoperative to the extent that the construction
is unreasonable.
(2) Subject to subsection (3),
to exclude or modify the implied warranty of merchantability
or any part of it the language must mention "merchantability",
be by a writing, and be conspicuous. Subject to subsection (3),
to exclude or modify any implied warranty of fitness the exclusion
must be by a writing and be conspicuous. Language to exclude
all implied warranties of fitness is sufficient if it is in writing,
is conspicuous and states, for example, "There is no warranty
that the goods will be fit for a particular purpose.".
(3) Notwithstanding subsection
(2), but subject to subsection (4),
(a) unless
the circumstances indicate otherwise, all
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implied warranties are excluded by expressions
like "as is" or "with all faults" or
by other language that in common understanding
calls the lessee's attention to the exclusion of
warranties and makes plain that there is no implied
warranty, if in writing and conspicuous;
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(b)
if the lessee before entering into the lease
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contract has examined the goods or the
sample or model as fully as desired or has refused
to examine the goods, there is no implied warranty
with regard to defects that an examination ought
in the circumstances to have revealed; and
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(c)
an implied warranty may also be excluded or
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modified by course of dealing, course
of performance, or usage of trade.
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(4) To exclude
or modify a warranty against interference or against infringement
(Section 2A-211) or any part of it, the language
must be specific, be by a writing, and be conspicuous,
unless the circumstances, including course of performance,
course of dealing, or usage of trade, give the lessee reason
to know that the goods are being leased subject to a claim
or interest of any person.
(Source: P.A. 87-493.)
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(810 ILCS 5/2A-215) (from Ch. 26, par. 2A-215)
Sec. 2A-215. Cumulation and
conflict of warranties express or implied. Warranties, whether
express or implied, must be construed as consistent with each
other and as cumulative, but if that construction is unreasonable,
the intention of the parties determines which warranty is dominant.
In ascertaining that intention the following rules apply:
(a) Exact
or technical specifications displace an
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inconsistent sample or model or general
language of description.
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(b)
A sample from an existing bulk displaces
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inconsistent general language of description.
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(c)
Express warranties displace inconsistent implied
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