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Leaf Financial Corp. v. ACS Services, Inc.

Delaware Superior Court
2010 WL 1740884 (2010)


Facts

Leaf Financial Corporation (Leaf) (plaintiff) entered a finance-lease contract with ACS Services, Inc. (ACS) (defendant). In this contract, Leaf agreed to purchase software of ACS’s choice from N-Able. Leaf would then lease the software to ACS. The contract included a waiver of all warranties. Under the contract, unless ACS rejected the software within seven days of installation, ACS was required to make payments to Leaf regardless of the software’s condition. The contract itself stated that it was a finance lease pursuant to Article 2A of the Uniform Commercial Code (UCC) and contained an integration clause. Finally, the contract contained a signed addendum in which ACS specifically waived its right to raise the software’s failure as a defense if Leaf attempted to enforce the contract. The software was delivered to ACS, and ACS did not reject it. However, the software did not function properly, and ACS was unable to remedy the software’s deficiencies. ACS never made any lease payments to Leaf. Leaf sued ACS for breach of a finance-lease contract and moved for summary judgment. ACS argued that the warranties provided by Article 2A relieved ACS of its obligation to pay for defective merchandise.

Rule of Law

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Issue

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Holding and Reasoning (Brady, J.)

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  • A "yes" or "no" answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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