Sources and Definitions of Contract Law
Sources and Definitions of Contract Law
Sources and Definitions of Contract Law
A contract is a promise or a set of promises for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty. [Rest. 2d 1] B. Promise is legally enforceable 1. Was made part of a bargain for valid consideration; OR 2. Reasonably induced the promisee to rely on the promise to his detriment; OR 3. Is deemed enforceable by a statute despite the lack of consideration II. Sources of Contract Law A. Common Law 1. Judge made law. B. Restatement 1. Written by the ALI, is persuasive authority unless enacted by the court C. Uniform Commercial Code (UCC) 1. Created jointly by the ALI and NCCLUSL. Adopted by every state but Louisiana D. United Nations Convention on Contracts for the International Sale of Goods 1. Governs many transactions for the sale of goods between parties with places of business in different nations E. Uniform Computer Transaction Act 1. Addresses issues of computer licensing (only been enacted by Virginia and Maryland) F. Uniform Electronic Transaction Act 1. Does not affect basic contract doctrine but governs the use of electronic communications III. Contracts For The Sale of Goods A. Article 2 of the UCC 1. Article 2 of the UCC covers all transactions for the sale of goods 2. Exceptions a. Securities (Article 9) b. Leases (Article 2A) B. Important UCC Article 2 Definitions 1. Goods a. A good is any tangible thing that is moveable [UCC 2-105(1)] b. Does not encompass 1. Intangible rights such as intellectual property 2. Investment securities 3. Money which is the medium of payment for goods 2. Sale a. Sale is the transfer of title for a price [UCC 2-106(1)]
b. *** Contracts that involve both goods and services must be evaluated to see which constitutes the primary purpose of the contract, with the secondary purpose being treated as incidental 3. Merchant a. A merchant is one who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill particular to the practice or goods involved in the transaction or who employs an agent or broker in such occupation. [UCC 2104(1)] 4. Good Faith a. Every contract for the sale of goods imposes an obligation of good faith dealings [UCC 1-203] b. All Parties 1. Honesty in fact in the conduct or transaction concerned [UCC 1-201(19)] c. Merchant (additional standard) 1. Honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade [UCC 2103(1)(b)]