N.Y. Uniform Commercial Code Law § 2-a-518: Cover; Substitute Goods

Section 2-A-518. Cover; Substitute Goods.

(1) After a default by a lessor under the lease contract of the type

described in Section 2-A-508(1) or, if agreed, after other default by

the lessor, the lessee may cover by making any purchase or lease of or

contract to purchase or lease goods in substitution for those due from

the lessor.

(2) Except as otherwise provided with respect to damages liquidated in

the lease agreement (Section 2-A-504) or otherwise determined pursuant

to agreement of the parties (Sections 1--302 and 2-A-503), if a lessee's

cover is by a lease agreement substantially similar to the original

lease agreement and the new lease agreement is made in good faith and in

a commercially reasonable manner, the lessee may recover from the lessor

as damages (a) the present value, as of the date of the commencement of

the term of the new lease agreement, of the rent under the new lease

agreement applicable to that period of the new lease term which is

comparable to the then remaining term of the original lease agreement

minus the present value as of the same date of the total rent for the

then remaining lease term of the original lease agreement, and (b) any

incidental or consequential damages, less expenses saved in consequence

of the lessor's default.

(3) If the lessee's cover is by lease agreement that qualifies for

treatment under subsection (2), the lessee may elect to proceed under

subsection (2) or Section 2-A-519. If a lessee's cover is by lease

agreement that for any reason does not qualify for treatment under

subsection (2), or is by purchase or otherwise, the lessee may recover

from the lessor as if the lessee had elected not to cover.