Sec. 42-158a. Definitions.
Sec. 42-158b. Required calculation of lease rate.
Sec. 42-158c. Required disclosures in lease agreements.
Sec. 42-158d. Unfair trade practice.
Sec. 42-158e. Conflict with state or federal law to be avoided.
Sec. 42-158f. Terms excluding or modifying implied warranties or remedies for breach unenforceable.
Sec. 42-158g. Required disclosures.
Sec. 42-158h.
Sec. 42-158a. Definitions. As used in sections 42-158a to 42-158g, inclusive, unless the context otherwise requires: Sec. 42-158b. Required calculation of lease rate. (a) No retail lessor shall enter
into a lease agreement with a retail lessee, unless the lease rate is calculated as follows:
The lease rate for a lease with equal base periodic payments and equal periodic intervals
is m X i X 100. For purposes of this subsection: Sec. 42-158c. Required disclosures in lease agreements. (a) Every retail lessor
shall disclose in the lease agreement provided to the retail lessee, in a clear and conspicuous manner, the lease amount financed, the lease finance charge, and the lease rate. Sec. 42-158d. Unfair trade practice. Failure to comply with any provision of
sections 42-158a to 42-158e, inclusive, shall be unlawful and constitute a deceptive and
unfair trade practice under subsection (a) of section 42-110b. Sec. 42-158e. Conflict with state or federal law to be avoided. Sections 42-158a
to 42-158e, inclusive, shall not be construed in a manner that is inconsistent with applicable provisions of federal law, including the federal Truth-In-Lending Act and the regulations promulgated pursuant to said act, or any laws of the state of Connecticut, including
provisions of the Uniform Commercial Code. Sec. 42-158f. Terms excluding or modifying implied warranties or remedies
for breach unenforceable. A term in a lease agreement that attempts to exclude or
modify an implied warranty of merchantability or fitness or to exclude or modify a
remedy for breach of such warranties is not enforceable. Sec. 42-158g. Required disclosures. Prior to a retail lessee signing a lease
agreement, with a retail lessor, the retail lessor shall make the disclosures specified in
the Consumer Credit Protection Act (15 USC 1667), as amended from time to time, and
Regulation M, 12 CFR Part 213, as amended from time to time, promulgated by the
Board of Governors of the Federal Reserve System pursuant to said act, regardless of
whether the lease agreement is subject to said act.
(1) "Motor vehicle" means a motor vehicle of the type and kind required to be
registered and titled under chapter 246, except a recreational vehicle, moped, motorcycle
powered by a motor with a displacement of fifty cubic centimeters or less or mobile
home.
(2) "Retail lessee" means a person who executes a retail lease agreement for a motor
vehicle from a retail lessor.
(3) "Retail lessor" means a person who regularly engages in the business of selling
or leasing motor vehicles and who offers or arranges a lease agreement for a motor
vehicle, including any agents or affiliates acting on behalf of the retail lessor.
(4) "Lease agreement" means a written agreement entered into in this state for the
transfer from a retail lessor to a retail lessee of the right to possession and use of a motor
vehicle primarily for personal, family or household use, in exchange for consideration
for a scheduled term exceeding four months, whether or not the retail lessee has the
option to purchase or otherwise become the owner of the vehicle at the expiration of
the agreement. "Lease agreement" does not include an absolute sale, a sale pending
approval, or a retail instalment sale.
(5) "Adjusted capitalized cost" means the capitalized cost less any capitalized cost
reduction payment made by the retail lessee at the inception of the lease agreement and
any net trade-in allowance granted by the retail lessor.
(6) "Irregularity" means the amount or timing interval varies by more than twenty-
five per cent from the amount or timing interval most commonly specified under the
lease agreement.
(7) "Ending balance" means the purchase option price at the end of the lease term.
(8) "Lease amount financed" means the adjusted capitalized cost minus:
(A) Any lease finance charge included in it; and
(B) Any advance lease payment or nonrefundable security deposit due on or before
delivery of the motor vehicle.
(9) (A) "Lease finance charge" means the rent charge plus any other charge payable
directly or indirectly by the retail lessee and imposed directly or indirectly by the retail
lessor as an incident to, or condition of, the lease agreement.
(B) "Lease finance charge" includes:
(i) An origination or acquisition charge;
(ii) A charge for assigning, servicing or carrying the lease;
(iii) Broker fees;
(iv) A disposition or pick-up charge due on lease termination;
(v) Taxes unique to leases.
(C) "Lease finance charge" does not include:
(i) Charges of a type payable in a cash purchase, such as official fees for sales or
use taxes, registration or title, or for an extended warranty or service contract;
(ii) Charges for late payment or other delinquency or default;
(iii) A refundable security deposit;
(iv) Premiums for insurance;
(v) Charges for additional authorized mileage;
(vi) An application fee charged to all applicants whether or not a lease agreement
is consummated;
(vii) Fees prescribed by law that actually are or will be paid to public officials for
determining the existence of or for perfecting, releasing or satisfying a security interest.
(10) "Lease rate" means the nominal annual percentage rate that reflects the amortization of the lease amount financed to the ending balance over the scheduled term of the
lease, calculated according to the actuarial method of allocating base periodic payments
made on an obligation between the lease finance charge and the lease amount financed,
pursuant to which a payment is applied first to the accrued lease finance charge and the
balance is applied to the unpaid lease amount financed.
(P.A. 99-278, S. 1; P.A. 00-219, S. 1.)
History: P.A. 00-219 redefined "lease agreement" in Subdiv. (4) by deleting "on or after July 1, 2000,".
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(1) "m" is the number of payment periods in a year, and the value of "i" is such that
(2) "C" is the lease amount financed;
(3) "P" is the amount of each base periodic payment;
(4) "R" is the ending balance;
(5) "n" is the number of payment periods in the lease; and
(6) "z" is the number of base periodic payments that are paid at or before the beginning of the lease term.
(b) If there is an irregularity in the amount or timing of base periodic payments
required during the lease term, the equation in subsection (a) of this section shall be
modified as necessary to calculate the value of "i" in accordance with actuarial principles.
(c) For purposes of this section:
(1) When a lease calls for payments to be made at intervals measured by reference
to weeks or months, the lease rate may be calculated on the assumption that each week
is one-fifty-second of a year long or that each month is one-twelfth of a year long.
(2) In a lease with no irregularity in the amount or timing of base periodic payments,
a disclosed lease rate shall be considered accurate if it is within one-eighth of one per
cent of the actual lease rate, as calculated in accordance with this section.
(3) In a lease with an irregularity in the amount or timing of base periodic payments,
a disclosed lease rate shall be considered accurate if it is within one-fourth of one per
cent of the actual lease rate, as calculated in accordance with this section.
(4) The Commissioner of Motor Vehicles, in regulations adopted pursuant to chapter 54, may prescribe additional assumptions for calculating the lease rate or its component values.
(d) The provisions of this section shall apply to lease agreements entered into on
or after July 1, 2001.
(P.A. 99-278, S. 2; P.A. 00-219, S. 4, 6.)
History: P.A. 00-219 added Subsec. (d) re application of section to leases entered into on or after July 1, 2001, effective
June 1, 2000.
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(b) The provisions of subsection (a) of this section shall apply to lease agreements
entered into on or after July 1, 2001.
(P.A. 99-278, S. 3; P.A. 00-219, S. 5, 6.)
History: P.A. 00-219 designated existing provisions as Subsec. (a), making a technical change and deleting reference
to consumer lease disclosure, and added Subsec. (b) making Subsec. (a) applicable to leases entered into on or after July
1, 2001, effective June 1, 2000.
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(P.A. 99-278, S. 4.)
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(P.A. 99-278, S. 5.)
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(P.A. 00-219, S. 2.)
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(P.A. 00-219, S. 3.)
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