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Bill

A 1140

Allows termination of motor vehicle lease in event of death; prohibits imposition of fee for early termination.

2026-2027 Regular Session Introduced by Craig Coughlin and 3 co-sponsors

Allows immediate termination of NJ-registered vehicle leases upon the lessee’s death without early termination fees, requiring disclosure and a $500 penalty for noncompliance.

Introduced, Referred to Assembly Consumer Affairs Committee
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WeVote Research Nonpartisan
Bill Summary · A 1140

Summary of Bill A-1140 (Session 222, New Jersey)

Purpose and intent

  • Establishes rules governing the termination of motor vehicle leases upon the death of the lessee.
  • Prohibits charging a fee for early termination of a lease due to the lessee’s death.
  • Requires clear disclosure to lessees about the death-related termination option.
  • Applies to non-commercial leases (with specific exemptions).

Key provisions and changes

1) Early termination rights upon death
- A dealer or lessor must allow early termination of a motor vehicle lease if:
- The vehicle was leased in New Jersey, and
- At death, the vehicle is registered in New Jersey.
- The lease ends when the vehicle is returned to the dealer or lessor.

2) Fees and charges
- No fee may be imposed for the early termination due to the lessee’s death.
- The prohibition on early-termination fees does not bar reasonable charges for excess wear, use, or mileage if those charges are specified in the lease agreement.

3) Obligations of surviving parties
- A surviving spouse, family member, guardian, or estate administrator/executor may not be forced to:
- purchase the leased vehicle,
- buy out the remainder of the lease, or
- continue leasing under the original terms, solely because of the lessee’s death.

4) Documentation and timeline
- Surviving parties must provide death documentation (e.g., a death certificate) to the dealer or lessor within 60 days of the decedent’s death to trigger termination.

5) Exceptions and clarifications
- The act does not apply to commercial vehicles.
- It does not apply to a surviving co-lessee who was a party to the original lease agreement.
- The termination occurs upon return of the vehicle to the dealer or lessor.

6) Disclosure requirements and penalties
- Dealers/lessors must include written disclosure in the lease or financing agreement that the lease may be terminated early upon the lessee’s death (per the bill’s provisions).
- Penalty for failing to provide the disclosure: $500, enforceable via civil action under the Penalty Enforcement Law of 1999.

7) Effective dates
- Section 1 (termination rights upon death) takes effect immediately and applies to leases signed on or after enactment.
- Section 2 (disclosure and penalties) takes effect on the first day of the second month after enactment.

Who is affected

  • Lessees and their families (surviving spouses, children, guardians, executors/administrators) who might benefit from death-related lease termination.
  • Dealers and lessors who lease motor vehicles in New Jersey, who must comply with new termination, disclosure, and penalty provisions.
  • Non-commercial vehicle lease arrangements are covered; commercial leases are exempt.
  • Surviving co-lessees who signed the lease with the decedent are not affected by these provisions.

Practical implications and potential impact

  • Provides a clear, risk-mitigated pathway for transferring or ending a lease after a lessee’s death without punitive costs.
  • Reduces potential financial and logistical burdens on families during a difficult time.
  • Encourages transparency in lease agreements through required disclosures.
  • Establishes a $500 penalty for failure to include the required death-termination disclosure, incentivizing compliance.

Summary

Bill A-1140 would allow immediate termination of a motor vehicle lease upon the lessee’s death, so long as the vehicle is registered in New Jersey at the time of death and the vehicle is returned. It bans early-termination fees tied to death, while permitting reasonable charges for excess wear or mileage when specified in the lease. It forbids forcing survivors to buy, continue, or buy out the lease due to death, requires timely death documentation (within 60 days), and mandates explicit disclosures in lease agreements with a $500 penalty for noncompliance. Commercial vehicles and surviving co-lessees are subject to certain exclusions. The immediate effect applies to leases signed after enactment, with disclosure requirements taking effect the following month.

Compiled from official sources — confirm details with the bill’s official record.

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