Repossessions: 14.2.11.1 Statute of Limitations for Lessor’s Collection of Early Termination Liability
UCC § 2A-506 provides a four-year statute of limitations for an action for default of a lease contract. The four-year period begins the later of when the default occurred or when the lessor should have discovered the default.261 Consequently, a lessor or a debt buyer purchasing the obligation from the lessor cannot seek an early termination penalty in court more than four years after the default or when the lessor should have discovered the default.