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Can you summarize MNST 336.2A-401?
UNIFORM COMMERCIAL CODE > INSECURITY; ADEQUATE ASSURANCE OF PERFORMANCE.
Short Summary
This legal document, part of the Minnesota Statutes under the Uniform Commercial Code, governs lease contracts. It imposes an obligation on each party to ensure that the other party’s expectation of receiving due performance is not impaired. If reasonable grounds for insecurity arise regarding the performance of either party, the insecure party may demand adequate assurance of due performance in writing. Until such assurance is received, the insecure party may suspend any performance for which they have not already received the agreed return, if commercially reasonable. Failure to provide adequate assurance within a reasonable time, not exceeding 30 days after receipt of a demand, constitutes a repudiation of the lease contract. The reasonableness of grounds for insecurity and the adequacy of any assurance offered are determined according to commercial standards when the parties involved are merchants. Acceptance of nonconforming delivery or payment does not prejudice the aggrieved party’s right to demand adequate assurance for future performance.
Whom does it apply to?
Parties involved in lease contracts
What does it govern?
Lease contracts
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Minnesota