2414

The lessor is bound to credit all rates and other payments made by the lessee pursuant to the lease contract and shall not apply the same to other existing debts between both of them generated by other contracts or obligations.\nAny compensation received as a result of a claim for the loss or damage to the leased chattel shall be used to cover the costs of the damage to the chattel. If the amount received is insufficient to cover the loss, the lessee shall be liable for covering the costs in excess of what was received to repair the chattel.\nThe application of this section shall be mandatory for consumer leases and financial leases in which the leased chattel is a motor vehicle. In all other kinds of leases, compliance with this section shall be required unless the parties agree otherwise.\nHistory —Aug. 13, 1994, No. 76, § 16, eff. 60 days after Aug. 13, 1994; Feb. 9, 2012, No. 41, § 2.