Contracts
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. |
