California · Commercial Code
COM §10525: (a) If a lessor discovers the lessee to be insolvent, the lessor may refuse to deliver the goods.
What this law says, in plain English
A lessor may refuse to deliver goods if the lessor discovers the lessee is insolvent.
Read the full statutory text
(a) If a lessor discovers the lessee to be insolvent, the lessor may refuse to deliver the goods. (b) After a default by the lessee under the lease contract of the type described in subdivision (a) of, or paragraph (1) of subdivision (c) of, Section 10523 or, if agreed, after other default by the lessee, the lessor has the right to take possession of the goods. If the lease contract so provides, the lessor may require the lessee to assemble the goods and make them available to the lessor at a place to be designated by the lessor which is reasonably convenient to both parties. Without removal, the lessor may render unusable any goods employed in trade or business, and may dispose of goods on the lessee’s premises (Section 10527). (c) The lessor may proceed under subdivision (b) without judicial process if it can be done without breach of the peace or the lessor may proceed by action.
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