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HomeCommercial CodeDiv. 10Ch. 3§ 10307 Lessee Creditor Rights

§ 10307 Lessee Creditor Rights

Commercial Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 10307 Lessee Creditor Rights

This law says that if someone owes money, their stuff can't be taken away if it's already being rented out. The person renting it gets to keep using it.

Key Takeaways

  • •If you rent something, the person you rent from can't lose it to their creditors.
  • •If the rental company owes money, the stuff you rent is safe.
  • •This doesn't apply if the creditor had a claim on the stuff before the rental started.

Example

You rent a car from a company, and the company owes money to a bank.

The bank can't take the car away from you just because the company owes them money. You get to keep driving it.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 10307 Lessee Creditor Rights

(a) Except as otherwise provided in Section 10306, a creditor of a lessee takes subject to the lease contract. (b) Except as otherwise provided in subdivision (c) and in Sections 10306 and 10308, a creditor of a lessor takes subject to the lease contract unless the creditor holds a lien that attached to the goods before the lease contract became enforceable. (c) Except as otherwise provided in Sections 9317, 9321, and 9323, a lessee takes a leasehold interest subject to a security interest held by a creditor of the lessor. (Amended by Stats. 1999, Ch. 991, Sec. 38. Effective January 1, 2000. Operative July 1, 2001, by Sec. 75 of Ch. 991.)

Last verified: January 10, 2026

Key Terms

creditor of a lesseecreditor of a lessorlease contractlienleasehold interestsecurity interest

Related Statutes

  • § 10306 Lien Priority Over Leases
  • § 10301 Lease Contract Enforcement
  • § 10304 Subsequent Leasehold Interest Transfer
  • § 10305 Lessee Transfer Of Goods
  • § 10308 Creditor Rights In Leases

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Commercial Code. Section 10307.
View Official Source