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There are two types of contact law. The Uniform Commercial Code, (UCC,) has been adopted in one form or another by all the states except Louisiana for contracts of the sale of goods. The UCC is particularly applicable to merchants but contracts between non-merchants for the sale of goods are also under the UCC, although the UCC holds merchants to a higher standard.  Contracts outside the UCC are, in most cases, governed by the common law of the state in which the contract is executed. (Here again Louisiana is an exception because Louisianan's laws are based on civil law not common law.) The rules of a UCC contact and a non-UCC contract can be very different. 

It is perhaps best to denote what contracts are not covered by the UCC. Firstly, the sale of real-estate is never covered by the UCC. Also, services and securities are not covered. The sale of a business is not a UCC transaction.

The sale of goods is covered. "Goods" is any moveable goods which includes commodities like rice, corn, sugar, as well as finished goods like cars, boats, etc.

Formation of a Contract

In order to have a contract, UCC or non-UCC, there must be 1.) an offer, 2.) acceptance, and 3.) consideration. An offer is a communication that gives to the recipient of the communication the power to conclude a contract by accepting. A statement is an offer only if the person to whom it is communicated could reasonably interpret it as an offer. The test of whether a communication is an offer is whether an individuals receiving the communication would believe that he could enter into an enforceable deal by satisfying the conduction.

An acceptance is an exercise of the power to conclude a contract given to an offeree by the offeror. Only the person to whom the offer is made may accept. the offeree must know of the offer in order to accept. Thus, when offers cross in the mail, there is no contract.

There are two basic elements of consideration. One is legal detriment. There must be something of substance, either an act or a promise, that is given in exchange for the promise which is to be enforced. The second element is bargained-for-exchange. A bargained-fro-exchange can be a returned promise to do or to not do something, or the actual act of doing something or refraining from doing something.

Go to the Contracts page for all types of downloadable contact forms, contract overviews in common language, and in depth legal thesis on contracts.