BU451 Lecture Notes - Quantum Meruit, Finance Lease, Net Lease
Document Summary
Spectrum of leasing: true lease lease with genuine bona fide option to buy lease with option sale with vtb (vendor take back mortgage) conditional sale purchase. Lease with option : after the term, you only pay a nominal fee to purchase. It"s different from a sale because it shows up differently on a balance sheet. However, if it looks like a duck, quacks like a duck, sounds like a duck, it. So even though they don"t think title passes, it has passed at the signing of the contract, so the vendor"s interest is gone. Sale w/ vtb keeps a security interest with vendor, so if customer is bankrupt vendor gets it back. If the security interest isn"t registered with the ppsa, it is unenforceable. Def"n: gross lease: everything"s included in the rent. Def"n: net, net, net lease: here"s base rent, and any additional expenses that the landlord incur will be additional rent for the tenant.
