Ch10-SG - Sales,Leases,andEContracts WHATTHIS CHAPTERISA...

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Chapter 10 Sales, Leases, and E-Contracts W HAT   THIS  C HAPTER  I S  A BOUT The Uniform  Commercial Code  (UCC) provides  a framework  of rules to deal with  all the phases  arising  in  an ordinary  sales transaction  from start to finish—from  sale to payment. This chapter  outlines the principles of UCC  Article 2 and  Article 2A. C HAPTER  O UTLINE I. THE SCOPE OF ARTICLE 2—SALES OF GOODS Article 2 governs  contracts for sales of goods. A  sale  is “the passing  of title from the seller to the buyer  for a  price”  [UCC  2–106(1)].   Title   is the  formal  right  of ownership  of property.  The  price  may  be  payable  in  money, goods, services, or land.  Goods  are tangible and  movable. II. THE SCOPE OF ARTICLE 2A—LEASES Article 2A governs  contracts for leases of goods.  A  lease agreement  is the bargain of the lessor and  lessee, in  their  words  and  deeds,  including  course  of dealing, usage  of trade,  and  course  of performance  [UCC 2A– 103(k)]. III. THE AMENDMENTS TO ARTICLES 2 AND  2A Amendments  have been proposed  to update  these articles to accommodate  e-commerce. IV. THE FORMATION OF SALES AND  LEASE CONTRACTS The following  sections summarize how  UCC provisions  change  the effect of the common  law of contracts. A. O FFER Verbal exchanges, correspondence, and  the actions of the parties may  not reveal exactly when  a binding   contractual  obligation  arises. An  agreement  sufficient  to constitute  a contract  can exist even  if the mo - ment of its making  is undetermined  [UCC 2–204(2), 2A–204(2)]. 1. Open Terms A sales contract will not fail for indefiniteness, even if one or more terms are left open, as long as (1)  the  parties  intended  to make  a contract  and  (2) there  is a reasonably  certain  basis for the  court  to  grant  an appro priate remedy  [UCC 2–204(3), 2A–204(3)]. (Without  a quantity  term, there is no basis  for a remedy.) 2. Merchant’s Firm Offer If a merchant  gives  assurances  in a signed  writing  that  an  offer  will remain  open,  the  offer is ir- revocable, without  consideration  for the stated  period  of time, or if no definite  period  is specified,  for a reasonable period (not more than three months) [UCC 2–205, 2A–205]. B. A CCEPTANCE 1. Promise to Ship or Prompt Shipment 75
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76 UNIT 3: THE PRIVATE ENVIRONMENT The UCC permits  acceptance  of an  offer to buy  goods  for current  or prompt  shipment  by either  a  promise  to ship  or prompt  shipment  of goods  to the buyer  [UCC 2–206(1)(b)]. Shipment  of noncon - forming goods is both an acceptance and  a breach. 2.
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This note was uploaded on 12/20/2010 for the course BUS 100 taught by Professor Staff during the Fall '09 term at CSU Dominguez Hills.

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Ch10-SG - Sales,Leases,andEContracts WHATTHIS CHAPTERISA...

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