N.Y. Uniform Commercial Code Law § 2-a-308: Special Rights of Creditors

Section 2-A-308. Special Rights of Creditors.

(1) A creditor of a lessor in possession of goods subject to a lease

contract may treat the lease contract as void if as against the creditor

retention of possession by the lessor is fraudulent under any statute or

rule of law, but retention of possession in good faith and current

course of trade by the lessor for a commercially reasonable time after

the lease contract becomes enforceable is not fraudulent.

(2) Nothing in this Article impairs the rights of creditors of a

lessor if the lease contract (a) becomes enforceable, not in current

course of trade but in satisfaction of or as security for a preexisting

claim for money, security, or the like, and (b) is made under

circumstances which under any statute or rule of law apart from this

Article would constitute the transaction a fraudulent transfer or

voidable preference.

(3) A creditor of a seller may treat a sale or an identification of

goods to a contract for sale as void if as against the creditor

retention of possession by the seller is fraudulent under any statute or

rule of law, but retention of possession of the goods pursuant to a

lease contract entered into by the seller as lessee and the buyer as

lessor in connection with the sale or identification of the goods is not

fraudulent if the buyer bought for value and in good faith.