Avis-Rent-A-Car System, Inc. v. Franklin

Memorandum. In our opinion, the "lease agreement” is, in fact, a secured transaction within the meaning of article 9 of the Uniform Commercial Code. Unlike a mere lease, the agreement in question is of an indefinite duration and, at its inception, passes all the risks and indicia of ownership of the vehicle to the defendant. Defendant not only insures against any loss to the plaintiff of its capitalized cost, but after 26 months, is entitled to any surplus funds if and when the car is sold. At the end of 56 months, the car would, at the option of the defendant, pass to her at no cost, since…