Commercial Transactions

Front 1

FORMATION - Scope - Does Art. 2 apply?

Back 1

Art. 2 extends to transactions in goods (all things tangible and movable at the time of K).
Art. 2 relaxes the CL K formula: offer + acceptance + consideration = K

Front 2

FORMATION - Scope - Tests for Mixed Goods and Services

Back 2

Predominant Purpose: if PP is to sell goods (as opposed to services) then Art. 2 applies to the whole transaction.
Gravamen of the Action: if the source of the problem lies in goods then Art. 2 applies, even if the PP is services.

Front 3

FORMATION - Scope - Hierarchy of Terms

Back 3

Express terms
Course of Performance (COP): repeated occasions of performance w/i same K
Course of Dealing (COD): previous conduct which is now implied
Usage of Trade (UOT): industry norm
UCC Gap Fillers:
CL Rules:

Front 4

FORMATION - Scope - Merchant Rules

Back 4

Person who deals in goods or holds himself out as having particular knowledge of them.
3 Groups found in cmt 2 to 2-104(1).

Front 5

FORMATION - Generally - Central Question of Formation

Back 5

Is there a K?
Need agreement (bargain in fact/mutual assent, offer, acceptance) and reasonable terms.

Front 6

FORMATION - Generally - Definitions

Back 6

Contract: total legal obligation
Agreement: bargain of the parties
Terms: terms (conduct, COP, COD and UOT) - unenforceable via Code (parole evidence, statute of frauds) + Code substitutes (gap fillers like implied warranties)

Front 7

FORMATION - Generally - Contract Formation Provisions - Formation in General

Back 7

3 Broad Principles:
1. Sales Ks can be made in any manner sufficient to show agreement.
2. Agreement can be found even though the moment of its making is undetermined.
3. Only substantive detail required is that there is some basis for calculating a remedy.

Front 8

FORMATION - Generally - Contract Formation Provisions - Firm Offers

Back 8

A promise to keep offer open for a period of time.
Must be contained in a writing, signed by offeror, with assurances, limited to "buy or sell goods", made by merchant, and cannot exceed 3 months.

Front 9

FORMATION - Generally - Contract Formation Provisions - Offer and Acceptance in Formation of Contract

Back 9

Valid acceptance can be in any manner and by any medium reasonable under the circumstances.
Invalid acceptance occurs when its not "definite and seasonable" or its expressly made conditional on "additional or different terms."

Front 10

FORMATION - Battle of the Forms - Additional Terms in Acceptance or Confirmation

Back 10

2-207 is meant to cure the CL mirror image rule (only acceptance if mirror image, anything else is rejection and counter-offer).

Front 11

FORMATION - Battle of the Forms - Is there a K?

Back 11

K by Writing:
Written Acceptance - Offeree's written acceptance w/ additional or different terms is valid unless it is not "definite and seasonable" or its expressly conditioned on Offerer's consent to additional terms.
Confirmation of Pre-Existing Oral K - Already accepted, just determine terms.

Front 12

FORMATION - Statute of Frauds - Requirements

Back 12

A K for sale of goods greater than $500 must be in writing, signed by the party trying to avoid the K, and must contain a written quantity term.

Front 13

FORMATION - Statute of Frauds - Exceptions

Back 13

Merchant Exception: makes writing effective against non-signing merchant, unless he objects.
Specialty goods/detrimental reliance exception: seller relied to its detriment on oral K.
Admissions Exception: K was made, but not enforceable beyond quantity admitted.
Part Performance: to the extent seller receives and accepts payment or buyer receives and accepts goods, neither can deny existence of oral K.
Waiver: unclear from drafter's perspective.

Front 14

FORMATION - Parol Evidence Rule

Back 14

Used to resolve disputes over the obligations of a K, when it is determined that the K was not intended to be a complete and exclusive statement of the terms.
Use evidence outside the 4 corners of the document.

Front 15

FORMATION - Parol Evidence Rule - Judge Made Exceptions

Back 15

Fraud: party can shield his fraud 2-202
Mistake: cannot shield mistake 2-202
True Ambiguous Terms: or evidence of a truly ambiguous term.

Front 16

TERMS - Creation of Seller's Warranties - Express Warranties by Affirmation, Description, Sample & Model

Back 16

Affirmations: Must be made by the seller to the buyer AND must be a basis for the bargain.
Description: source is irrelevant; only needs to be basis of bargain.
Sample or Model: provided by buyer to seller and must be part of the basis of the bargain.

Front 17

TERMS - Creation of Seller's Warranties - Implied Warranty of Merchantability

Back 17

Must be a merchant with respect to goods of that kind and all parties must act in good faith.
6 minimum standards set out in 2-314(2)

Front 18

TERMS - Creation of Seller's Warranties - Implied Warranty of Fitness for a Particular Purpose

Back 18

When ordinary goods are sold for a special purpose and seller has reason to know of the particular purpose and that buyer is relying on seller's expertise.

Front 19

TERMS - Warranty Disclaimers; Remedy Limitations -

Back 19

Must show warranty was made and breached, causation, and P's ability to defeat affirmative defenses (disclaimer, statute of limitations, lack of notice, lack of privity, and assumption of risk).

Front 20

PERFORMANCE - Commercial Impracticability - Anticipatory Repudiation

Back 20

Adequate Assurances :Can suspend performance while waiting for adequate assurances. Must show reasonable grounds for insecurity + written demand.
Anticipatory Repudiation: when one party knows before the performance date that they will not be able to perform, other party may stop their performance and wait for other's performance or sue for breach.

Front 21

PERFORMANCE - Commercial Impracticability - Impossibility of Performance

Back 21

1. K requires delivery of goods identified
2. Loss, destruction, or damage of those goods must not have been the fault of either party.
3. Risk of loss must not have passed to the buyer.