Which of the following is a remedy that the lessor may pursue in the event of default?

• A. Return of the equipment upon receipt of instructions
• B. Renegotiation of lease terms
• C. Suspension of rent for the remainder of the term
• D. Extension of the lease term on request

Answer: (A)

When a lessee defaults, the essential action for the lessor is to recover the asset and limit losses. Reclaiming possession of the equipment is a direct remedy that fits this goal: the lessor can instruct the lessee to return the equipment and then take back custody so the asset can be re-leased or sold. This option embodies the landlord’s right to retrieve the collateral promptly after a default, which clears the way to mitigate damages.

Renegotiating lease terms, suspending rent, or extending the lease on request are not remedies triggered by default in the same way. Renegotiation is more about negotiating conditions than enforcing a remedy; suspending rent would reduce cash flow and doesn’t address the default, and extending the term is a modification that shifts the agreement rather than a remedy to cure or respond to default.