Exam:
Do not need section number, but use right wording.
Not responsible for the international sale of goods or CISG.
________________________________________________________________________
Article 1: General Provisions
1-201. General definitions
·
1-203. Obligation of good faith
·
1-204. Time; reasonable time; “seasonably”
·
1-205. Course of dealing and usage of trade
· Both supposed to be interpretive tools to help the trier of fact decide what the bargain was.
· CoD is how they have dealt with each other over the years;
o Acts much like an estoppel, but is not technically one.
· UoT is how do members of that business community (local) deal with each other normally.
o Again not a true estoppel; doesn’t rely on a parties conduct, but the background information.
o Must take steps in K to get around it.
· Both questions of fact.
· Subsection 6 requires that parties give the other party notice that they will be bringing in evidence like this; so the other party can get their own.
· Subsection 3 says that they give meaning to or supplement language in the contract.
o Can be actual language or that put in by gap fillers.
o Problems arise when the UoT or CoD come in conflict with the written contract.
· Subsection 4 sets out the hierarchy of which controls which:
o Express LanguageàCourse of DealingàUsage of Trade
________________________________________________________________________
Article 2: Sales
Subtitle 1. Short Title, General Construction and Subject Matter
2-102. Scope; certain security and other transactions excluded from this title.
Difference b/w sales and service
Predominant purpose test in Maryland decides whether a mix of the two is a good or a service
Be aware of peculiar situation of consumer goods that are built into a building or real estate
Anthony Pools v. Sheehan
Normally wouldn’t be covered because it is an improvement to real estate,
But in MD, if you have a service or real estate improvement contract that contains a consumer good (i.e. diving board) which injures someone, we look at it as an article 2 transaction.
Article 2 is the last place in the UCC where there is still a differentiation in good faith duties based on the type of buyer and seller
Merchants have the duty of honesty in fact and reasonable commercial standards
2-103. Definitions
Adds “honesty in fact” requirement for merchants.
2-104. Definitions: “Merchant”; “between merchants”; “financing agency”
Merchant is someone who deals in goods of the kind or has knowledge or skill peculiar to the practice of the occupation
2 types of merchants
General business merchant
Someone who is sophisticated about business
Merchant in specific goods.
3 consequences/categories of being merchant (Comment 2)
1) General business practices, which apply to almost everyone selling something, require things like answering mail, and giving firm offers, etc.
2-201(2), 2-205, 2-207, & 2-209.
Lawyers and other people who are familiar with the rules may be held to some mercantile levels due to their understanding.
2) Implied warranty of merchantability is only applicable to merchants who deal in goods of that kind.
2-314, 2-402(2) & 2-403(2)
Even if you are car salesman, and you are out selling your own car, you will not be held to standard of merchant for warranty of merchantability.
3) General duty of good faith and fair dealing, responsibility of merchant buyers to follow seller’s instructions, risk of loss and adequate assurance of performance apply to either merchants under practices or goods aspects.
2-103(1)(b)2-327(1)(c), 2-603, 2-605, 2-509 and 2-609.
Transactions b/w merchants
What are goods?
Things that are movable at the time of the contract.
Sales of future goods apply similarly to things that will be goods in the future.
2-105. Definitions: Transferability; “goods”; “future” goods; “lot”; “commercial unit”.
– Goods
o Concept of identification at the time of sale
§ Very important Article 2 concept
§ In order to be goods it has to be movable not when the contract is made; but at the time it is identified to the contract.
· Can be later than when contract is formed.
· These are known as future goods.
§ Has a lot of impacts on later sections
– Very physical idea of identification.
o If at the time process of contract is performed, the items are mo
ntract was met, but must be reasonable basis for awarding for breach.
2-205. Firm offers
·
2-206. Offer and acceptance in formation of contract. (“Battle of the Forms”)
·
2-207. Additional terms in acceptance or confirmation
Can you have a contract w/o writing absent SOF,
Yes
Look at conduct.
2-208. Course of performance and practical construction
Background
Good faith
COD,
UOT,
is failure to observe usage of trade also failure to use good faith and fair dealing??
COP
very insular, only relates to the contract at hand
sets up an estoppel by parties performing a certain way
Cannot undermine the meaning of the contract
2-209. Modification, rescission and waiver.
“No oral modification” clauses are valid so long as they are in writing.
Big difference b/w code and common law is you don’t need consideration to modify the contract.
________________________________________________________________________
Subtitle 3. General Obligations and Construction of Contract
2-301. General obligations of parties
· Obligation of the seller is to transfer and deliver in accordance with the contract.
· Obligation of the buyer is to accept and pay in accordance with the contract.
o Simple.
· The rest of the code just elaborates on these obligations.
2-302. Unconscionable contract or clause.
Unconscionablity
Can apply to anything in contract, not just tied to damages;
But it is most frequently seen in damages cases
That’s where the money is.
You are entitled to a factual trial on unconscionablity, but it is an equitable issue for the judge.
It is there for the prevention of both oppression and unfair surprise.
Looked at from the time of contracting, not later.
Don’t want to insulate parties from risk.
