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2013-11-02 00:33:35
LL Contracts UCC

UCC and Restatement for Contracts 1
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  1. Construction of UCC
    • UCC 1-103(a) The UCC must be liberally construed and applied to promote its underlying purposes and policies,
    • (b) “Unless displaced by the particular provisions of this Act, the principles of law and equity, shall supplement its provisions” (Common law supplants unless UCC replaces it.)
  2. "goods" - defined by UCC
    • UCC 2-105 (1): “Goods means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities, and things in action”
    • (2) Future Good – Good that is not both existing and identified.
  3. Contract  definition (Restatement)
    Restatement (2d) of K § 1- "promise or 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"
  4. Promise definition
    Restatement (2d) of K § 2- “manifestation of intention to act or refrain from acting in a specified way, so made as to justify a p/ee in understanding that a commitment has been made”
  5. Restatement definition of Consideration
    • Restatement 2d § 71
    • 1) To constitute consideration, a performance or a return promise must be bargained for.(2) A performance or return promise is bargained for if it is sought by the p/or in exchange for the promise and is given by the p/ee in exchange for that promise.
  6. Doctrine of Unconscionability
    • • UCC 2-302(1)-
    • • If court finds a contract to be unconscionable at the time it was made, the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may limit the application of the unconscionable clause to avoid any unconscionable result
    • • Look at the process of the bargain; does one side have an unfair advantage?*note: this is a rare defense
  7. Modification Restatement
    • Rest. (2d) § 89(a): "A promise modifying a duty under contract not fully performed on either side (executory contract) is binding (a) if the modification is fair and equitable in view of circumstances not anticipated by the parties when the K was made…"

    • Modification must be voluntary → no hold up game (Angel)
  8. Modification under the UCC
    UCC 2-209(1) - "An agreement modifying a contract within this Article [Art. 2] needs no consideration to be binding”

    UCC 1-304- "Every contract or duty within [the Uniform Commercial Code] imposes an obligation of good faith in its performance"-

    UCC does not have a pre-exisiting duty rule, policy concerns satisfied by UCC 2-209 and 1-304 together.
  9. UCC Good Faith definition
    UCC 1-201(b)(20)o "Good faith means honesty in fact and the observance of reasonable commercial standards of fair dealings."

    • o Honest in fact = Subjectiveo
    • Reasonable commercial standard = objective