ucc and the common law

UCC and the Common Law

Learning Objective 13-5

• Understand the distinctions between common law contracts and UCC contracts.

Key Differences

• Common Law Contracts:

  • Governed by general principles of judge-made common law.

  • Typically applies to contracts involving the provision of services.

• UCC Contracts:

  • Governed by the Uniform Commercial Code (UCC), specifically Article 2.

  • Applies to contracts involving the sale of goods.

  • Preempts or displaces common law when goods are sold.

Importance for Business Owners

• Understanding the distinction is critical for business owners and managers, as:

  • The rights and obligations under common law contracts differ from those under UCC contracts.

  • UCC relaxes some common law contract requirements (e.g., doctrine of consideration).

Scope of Article 2 of the UCC

• Article 2 Overview:

  • Governs contracts for the sale of "goods."

  • Preempts common law in the sale of goods.

  • In areas where Article 2 is silent, common law governs.

Summary Takeaway

• Common Law Contracts are subject to stricter requirements compared to UCC Contracts for the sale of goods.