Miles acquires a power generator under a two- year lease with the manufacturer. After four months, Miles realises he no longer needs the generator. He delivers the generator back to the supplier hoping that his lease payments would stop, but to his dismay, he is informed that he will be expected to pay the remaining twenty payments. Will Miles legally be required to finish all the lease payments?
A) No, since he is no longer receiving benefits under the lease.
B) Yes, because this is an operations lease.
C) No, since he no longer requires the use of the generator.
D) No, because the lessor has the chattel in his possession.
E) Yes, since the contract made no provision for early termination.

Question

Quizplus · Accepted Answer

Since the contract made no provision for early termination, Miles will be legally required to finish all the lease payments as per the terms of the agreement.

Miles Acquires a Power Generator Under a Two- Year Lease