§ 2A310. Lessor's and lessee's rights when goods become

accessions.

(a) Definition.--Goods are "accessions" when they are installed in or affixed to other goods.

(b) Priority of interest before accession.--The interest of a lessor or a lessee under a lease contract entered into before the goods became accessions is superior to all interests in the whole except as stated in subsection (d).

(c) Priority of interest on or after accession.--The interest of a lessor or a lessee under a lease contract entered into at the time or after the goods became accessions is superior to all subsequently acquired interests in the whole except as stated in subsection (d) but is subordinate to interests in the whole existing at the time the lease contract was made unless the holders of such interests in the whole have in writing consented to the lease or disclaimed an interest in the goods as part of the whole.

(d) Subordination to interest in the whole.--The interest of a lessor or a lessee under a lease contract described in subsection (b) or (c) is subordinate to the interest of:

(1) a buyer in the ordinary course of business or a lessee in the ordinary course of business of any interest in the whole acquired after the goods became accessions; or

(2) a creditor with a security interest in the whole perfected before the lease contract was made to the extent that the creditor makes subsequent advances without knowledge of the lease contract.

(e) Removal of goods if interest has priority.--When under subsections (b) or (c) and (d) a lessor or a lessee of accessions holds an interest that is superior to all interests in the whole, the lessor or the lessee may:

(1) on default, expiration, termination or cancellation of the lease contract by the other party but subject to the provisions of the lease contract and this division; or

(2) if necessary to enforce his other rights and remedies under this division; remove the goods from the whole, free and clear of all interests in the whole, but he must reimburse any holder of an interest in the whole who is not the lessee and who has not otherwise agreed for the cost of repair of any physical injury but not for any diminution in value of the whole caused by the absence of the goods removed or by any necessity for replacing them. A person entitled to reimbursement may refuse permission to remove until the party seeking removal gives adequate security for the performance of this obligation.

Cross References. Section 2A310 is referred to in section 2A103 of this title.