Governed by UCC?
Article 2 of the UCC
· The UCC applies only to the sale of goods when over $500.
o ^Goods: things which are moveable at the time of the sale.
§ All things which are moveable at the time of identification to the contract for sale.
o ^Sale: the passing of title from the seller to the buyer for a price.
o ^Title: the legal link between a person who owns property and the property itself.
· Predominant Purpose Test:
o Whether the purpose of the agreement is the rendition of service, with goods incidentally involved OR is a transaction of sale, with labor incidentally involved.
§ UCC Governs = the “primary purpose” of the agreement is the sale of goods.
§ Money can be examined to determine. How much is spent on what.
ú Nim Plastics – new matte surface put on film was a service contract. The new surface was not an identifiable “moveable thing” and was not sold in a sense that title could be passed.
ú Taking raw cloth and making sheets = predominantly service.
ú Contract between magazine publisher and printing company = predominantly sale of goods.
ú Sale of furnace is sale of goods although the contract additionally called for design, assembly, and installation of furnaces.
Mutual Assent – Offer and Acceptance
Bargain Theory of Consideration: There needs to be an offer by one party and an acceptance by anot
e for the promise.
Agreement Process: Manifestations of Mutual Assent
Contract Continuum
Negotiation Agreement Performance
]
Mutual Assent (required)
]
Objective Theory (proof)
Mutual Assent
– Did the parties intend to make an agreement?
· How do we know?
– Did the parties agree to the same thing?
· How do we know?
IS THERE A CONTRACT?
Mutual Assent: To constitute a contract there must be a meeting of the minds of the parties, and both must agree to the same thing in the same sense.
Objective Test: Would a reasonable person hearing the words spoken and/or viewing the actions taken understand that a contract had been entered into?
· The law imputes to a person an intention corresponding to the reasonable meaning of his words and actions while examining any writing involved and the surround circumstances.
· Intention to Contract Test: Words and actions, also surrounding circumstances [context matters] based on a reasonable standard.
Also need to look at surrounding circumstances.
