Printable Format84-2a-503. Modification or impairment of rights and remedies. (1) Except as otherwise provided in this article, the lease agreement may include rights and remedies for default in addition to or in substitution for those provided in this article and may limit or alter the measure of damages recoverable under this article.
(2) Resort to a remedy provided under this article or in the lease agreement is optional unless the remedy is expressly agreed to be exclusive. If circumstances cause an exclusive or limited remedy to fail of its essential purpose, or provision for an exclusive remedy is unconscionable, remedy may be had as provided in this article.
(3) Consequential damages may be liquidated under K.S.A. 84-2a-503 [84-2a-504], or may otherwise be limited, altered or excluded unless the limitation, alteration or exclusion is unconscionable. Limitation, alteration or exclusion of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation, alteration or exclusion of damages where the loss is commercial is not prima facie unconscionable.
(4) Rights and remedies on default by the lessor or the lessee with respect to any obligation or promise collateral or ancillary to the lease contract are not impaired by this article.
History: L. 1991, ch. 295, ยง 51; February 1, 1992.
KANSAS COMMENT, 1996
1. This section generally leaves the parties free to shape their own remedies by contract and to limit or modify the remedies authorized by Article 2A. It is derived principally from section 84-2-719. The policy of this section, which gives great heed to the parties' freedom of contract, is consistent with the general approach of Article 2A, as well as the approach in its damages provisions. See, e.g., 84-2a-508(1)(d), 84-2a-518(2), 84-2a-519(1), 84-2a-523(1)(f), 84-2a-527(2), & 84-2a-528(1). Thus, subsection (1) provides that the parties to a lease contract may add to or substitute for the rights and remedies otherwise available under this Article, and that the parties may limit or modify the measure of damages otherwise recoverable under this Article.
2. Subsection (2) states the presumption that resort to any remedy provided by contract is optional. Cf. Kelley Metal Trading Co. v. Al-Jon/United, Inc., 835 F. Supp. 1339 (D. Kan. 1993) (finding buy-back provision in sales contract not intended to be exclusive remedy). If the parties do not expressly agree that the remedy is to be exclusive, all of this Article's remedies are available to the party.
3. In addition, if an exclusive contractual remedy "fail(s) of its essential purpose" or is unconscionable, subsection (2) permits the aggrieved party to resort to any remedy under Article 2A. The addition of an unconscionability standard makes explicit what is implicit in the statutory analogue: that if an exclusive remedy provision is unconscionable, the Article 2A remedies are fully available. For discussion of when a contractual remedy fails of its essential purpose, see 1996 Kansas Comment 3 to 84-2-719.
4. Under subsection (3), contractual limitations on consequential damages, including provisions that liquidate such damages (the proper reference is to 84-2a-504), are permitted unless unconscionable. Representative cases under Article 2 are cited in 1996 Kansas Comment 4 to 84-2-719. The special rule for leases of consumer goods, making limitation or exclusion of consequential damages for personal injury prima facie unconscionable, is likely to be unimportant in Kansas. Instead, the issue likely will be controlled by the Kansas Consumer Protection Act, K.S.A. 50-623 et seq., which flatly prohibits, in consumer leases, any limitation on remedies for breach of implied warranties and declares that any such limitation is void. K.S.A. 50-639(a) & (e).
5. Subsection (4) is based on section 84-2-701 and is included to make clear that the remedies granted by Article 2A to the lesser and lessee do not affect any remedies available under a security agreement or otherwise. See Official Comment 4 to this section for examples.