Chapter 13 Section 1
Bobbie K and Juan R
What is a Sale?
The Uniform Commercial Code (UCC) governs sales of goods, also governs contracts to sell goods in the
future. The UCC definition goods do not include
Money- (except rare currency or coins)
Intangible - (not touchable)
Patients and copyrights - (rights granted by the federal government)
Real Property - (land, buildings, and legal rights)
A sales contract may be made under any manner to show agreement. The law of contracts has been
simplified and made less strict. In a case where the price will be set at a later time and nothing is said
about a price, the buyer must pay a reasonable price when the product arrives.
Contracts that are not sales
In some situations goods may be included, however the main reason of the
contract is for a service. A contract in which a service is provided it is not under
the rules and consequences if it were under the UCC.
In both sales of goods and contracts to sell there are two types of people. The
seller is known as the the vendor, while the buyer is called the vendee.
Payment and Delivery
Payment happens when the buyer gives the seller an agreed upon amount for a good.
After payment Delivery occurs, which means the object is given to the buyer or it is now in
the buyer’s control.
Receipt of goods goes hand in hand with delivery in the aspect of that it is when the buyer
takes possession or control of the goods at hand.
In a basic sales transaction, one will pay, receive, and obtain ownership of said goods. The
buyer is obligated to pay for the good as the seller is obligated to provide the goods, these
don’t always typically have to occur at the same time, and the possession of goods can
change hands within and amount of time, but typically once money (or goods) has
exchanged hands.
Bill of Sale
A Bill of Sale is a receipt that proves ownership.
Sometimes the document is required by a statute .
It makes the sale of property easier.
If something is lost in disaster it can prove
it was yours.
People forge to steal.
Use of Credit
With the use of credit, qualified buyers may pay in installments. With installments
the buyer may receive the ownership and possession of the good before even the
first payment.
Most retailers deal with customers who either pay with credit cards or charge
accounts. Those customers then pay back for it in increments to pay off the
amount they charged.
Acceptance of Goods
Acceptance of goods occurs when the buyer either says that they are satisfactory,
treated as if the buyer would have, goes to sell them to another, however, if a
customer does not reject the goods in a certain amount of time it is assumed that
the goods are of good or approved upon quality.
Other Ways to Contract
A sales contract may be made through basic exchange of offer and acceptance.
The UCC says however, that the order can be confirmed by phone, fax, mail, or
even the sender simply sending the goods and alerting them of this action.
Unconsconable Sales Contracts
UCC may find a contract grossley unfair.
A court decides a contract is bad by:
refuse to enforse contract
limit the clauses application is not fair
no clause
SUMMARY
The UCC are the over-sees sales contracts in four ways. However there are
contracts that are services and those are not covered by UCC. Then there are
sales transactions and they get sales receipts so they can physically touch it.The
bill of sale is very important and can be forged. Also the UCC can call a contract
no good in 3 points.
Chapter 13 - Section 2
Chrystal Fellows & Thomas Reppenhagen
Special Rules for Merchants
The Uniform Commercial Code (UCC) treats all buyers and sellers alike, in most
cases.
Specialized rules may be applied to merchants
Merchants held to higher standard of conduct than casual sellers
Merchants may require licenses to sell, and are subjected to special taxation
and closer regulation by the government
Merchant Status in Sales Contracts
Under UCC, offeror can state the offer to buy/sell goods must be accepted
exactly as made or not at all
Common law allows for terms to be changed (counteroffers)
Under the law of sales of goods, the new terms are called a proposal for
addition; what happens depends if both parties are merchants
If the new term is a material alteration, it is only included if original offeror is
bound by it
How Does the Statute of Fraud Apply To Sales?
Sales contracts are enforceable in court; however, sales valued at $500 or more
must be evident in writing to be enforceable.
To satisfy the Statute of Frauds, all that is required is a writing signed by the
party being sued, which satisfies the court that a contract to sell has been
made.
Quantity of goods in transaction must be included in the writing
Between merchants, signature of party suing may be enough to prove an
otherwise unenforceable sales contract
Exceptions to the Statute of Frauds for Sales Contracts
Goods received and accepted by the buyer
A buyer may receive goods without accepting them
Under UCC, buyer can accept goods in three ways:
Buyer signifies to the seller that the goods conform to the contract or will be
retained in spite of their nonconformity
Buyer acts inconsistently with seller’s ownership
Ex: uses, consumers, resells good
Buyer fails to make an effective rejection after having a reasonable opportunity
to inspect the goods
Buyer Pays For Goods And Seller Accepts Payment
- When the full payment is paid and accepted by the seller, an oral contracts
enforceable.
- When only partial payment is accepted by the seller, an oral contract is only
enforceable for the paid for goods and the goods are divided into the amount
that is paid for. If the item isn’t divisible there is no quantity dispute and the
contract is fully enforceable.
Goods Specially Made Not Suitable For Sale To Others
A seller can enforce an oral contract for non-resalable goods if
1. The seller has substantially begun to manufacture them, or
2. The seller has made contracts to obtain the goods from third parties.
Summary
Merchants are generally held to a higher standard of conduct by the UCC than
casual sellers, as they are more knowledgeable in what they sell. Sales or
contracts to sell may be oral, written, or implied from the conduct of the parties. In
order for a contract to be enforceable in court, a sale for $500 or more must be
evidenced by a writing, which must specify at least a quantity of goods. However,
a writing is not essential under certain circumstances that still satisfy the Statute of
Fraud. Ultimately, there must be sufficient evident through writing for a sale to be
enforceable in court, and parties involved in the sale must follow normal, basic
sales procedures to avoid turmoil or involving the courts.