National Conference of Commissioners on Uniform State Laws

211 E. Ontario St., Suite 1300, Chicago, IL 60611
tel 312-915-0195, fax 312-915-0187

For Immediate Release

ACT ON LEASING OF CONSUMER GOODS APPROVED
NCCUSL Approves New Uniform Consumer Leases Act at Annual Meeting

August 16, 2001—The National Conference of Commissioners on Uniform State Laws(NCCUSL), at its 110th Annual Meeting in West Virginia, today approved the first comprehensive Act designed to regulate the consumer goods leasing industry. The Uniform Consumer Leases Act (UCLA) promotes leasing businesses and protects consumers by regulating certain lease terms and practices, while at the same time preserving contract flexibility for the parties involved.

"The leasing of consumer goods, particularly automobiles, has become a tremendously popular alternative to credit sales over the last few decades and continues to grow," said Justin L. Vigdor and Robert H. Cornell, co-chairs of the committee that drafted the UCLA. "Federal law has created certain disclosure requirements for consumer leases, and Article 2A of the Uniform Commercial Code created a statutory legal framework for leases of primarily commercial goods. However, neither of these laws comprehensively addressed the leasing businesses while protecting consumers. Approval of the Uniform Consumer Leases Act represents the first effort to fill this gap."

Although a handful of states have consumer protection legislation in place affecting consumer leases, most of these laws deal only with consumer leases of motor vehicles, and vary from state to state.

The UCLA applies to leases of consumer goods for a term longer than four months and less than $150,000. Thus, the Act does not cover short-term rentals, such as weekend car or tool rentals. The Act also does not cover rent-to-own contracts.

The UCLA prohibits deceptive advertising about leases, and entitles lease customers to a copy of the lease beforehand. It also requires lessors to furnish statements of account and pay-off information on request. The amount of late fees and default charges a lessor may charge are also restricted under the Act.

The UCLA borrows a procedure from the Uniform Consumer Credit Code of 1974, which prohibits a lessor from collection efforts until the lease customer has a chance to cure the default by bringing the account current.

The drafting committee for the Uniform Consumer Leases Act was co-chaired by Justin L. Vigdor of Rochester, New York, and Robert H. Cornell of Palo Alto, California. Other committee members included: Pamela G. Chin, Pasadena, California; Jack Davies, Mendota Heights, Minnesota; Patrick C. Guillot, Dallas, Texas; Neal Ossen, Hartford, Connecticut; H. Kathleen Patchel, Indianapolis, Indiana; Willis E. Sullivan, III, Boise, Idaho; and Charles J. Tabb, Champaign, Illinois. Ralph R. Rohner of Washington, DC, served as the committee's reporter.

The National Conference of Commissioners on Uniform State Laws is› now in its 110th year. The organization comprises more than 300 lawyers, judges, and law professors, appointed by the states as well as the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, to draft proposals for uniform and model laws and work toward their enactment in their legislatures. Since its inception in 1892, the group has promulgated more than 200 acts, among them such bulwarks of state statutory law as the Uniform Commercial Code, the Uniform Probate Code, and the Uniform Partnership Act.

For further information, please contact John McCabe or Katie Robinson at (312) 915-0195 or Gabrielle Bamberger at (212)333-5222. Also check the NCCUSL website at www.nccusl.org