Commercial Law Commons^™

Catalytic Impact Of Information Technology On The New International Financial Architecture, Jane K. Winn

Articles

The sudden emergence of the Internet as a global network threatens to eclipse the importance of the global information infrastructure painstakingly built by financial institutions and their regulators over the past three decades. The open public nature of the Internet threatens the value of the closed proprietary networks developed by financial institutions that now face serious problems in integrating their legacy systems and new Internet systems.

Information system security, once a dreary back office matter, is now central to the success of e-commerce business plans. Before financial institutions can capitalize on their expertise in information system security, they will have …

Electronic Records And Signatures Under The Federal E-Sign Legislation And The Ueta, Robert A. Wittie, Jane K. Winn

Articles

Federal legislation establishing legal parity between electronic records and signatures and their paper and ink counterparts was signed into law June 30, 2000, and became effective, at least for most purposes, on October 1. The Electronic Signatures in Global and National Commerce Act (E-SIGN or the Act) effectively sweeps away a myriad of anachronistic and inconsistent state and federal requirements for paper and ink documents and signatures. In so doing, E-SIGN eliminates many of the legal uncertainties that have surrounded the use of electronic media in commerce and should enable businesses and consumers alike to more fully realize the cost …

Making Xml Pay: Revising Existing Electronic Payments Law To Accommodate Innovation, Jane K. Winn

Articles

Many businesses today are rushing to embrace "e-Business" technologies in a mad scramble to remain competitive. Only a few years ago, simply using email instead of faxes or phone calls, converting a purchasing system to EDI technology, or building a corporate Web site might have seemed like important advances in the use of new information technologies.

Businesses are now moving beyond such "electronic commerce" technologies and trying to integrate their disparate information systems and business processes into a comprehensive new "e-Business" structure. At the heart of this new model for business organization is the idea that information and resources should …

Who Owns The Customer? The Emerging Law Of Commercial Transactions In Electronic Customer Data, Jane Kaufman Winn, James R. Wrathall

Articles

The Information Revolution is changing the way commerce acted and value is defined within transactions. Before the Internet and "e-business" took center stage, "electronic commerce" meant electronic data interchange, just-in-time inventory systems, supply chain automation, and corporate reengineering.

But the rise of the Internet as a communications medium has coincided with a shift in management focus, from merely trying to improve the efficiency of business logistics systems to a more holistic perspective on improving customer relationships. Intangible assets such as intellectual property rights, human capital in the form of employee knowledge, and established relationships with customers and suppliers are playing …

Clash Of The Titans: Regulating The Competition Between Established And Emerging Electronic Payment Systems, Jane Kaufman Winn

Articles

This article equates the providers of traditional electronic payment services with the Titans of Greek mythology, and the providers of new electronic payment technologies with the Olympians. Professor Winn concludes, however, that unlike the Titans of Greek mythology, these modern Titans appear to be winning in their battle with the upstart Olympians. This article describes the fundamental characteristics of payment systems, reviews the applicable law, and describes the new technologies that were, until quite recently, expected to displace older electronic payment systems. Professor Winn finds that consumers and merchants, by and large, are happy with the existing regulatory structure. And, …

Privately Legislated Intellectual Property Rights: Reconciling Freedom Of Contract With Public Good Uses Of Information, J.H. Reichman, Jonathan A. Franklin

Librarians' Articles

In an age of omnipresent clickwrap licenses, we acknowledge the need for a uniform set of default rules that would validate non-negotiable licenses as a mechanism for minimizing transaction costs likely to hinder economic development in a networked environment. However, we contend that any model of contract formation not driven by the traditional norms of mutual assent requires specially formulated doctrinal tools to avoid undermining long-established public good uses of information for such purposes as education and research, technical innovation, free speech, and the preservation of free competition.

With the convergence of digital and telecommunications technologies, creators and innovators who …

How Copyleft Uses License Rights To Succeed In The Open Source Software Revolution And The Implications For Article 2b, Robert W. Gomulkiewicz

Articles

The computer industry moves from one “next great thing” to the next “next great thing” with amazing speed. Graphical user interface, object-oriented programming, client-server computing, multimedia software, Java applets, the network computer, and the Internet have all been hailed as technological breakthroughs at one time or another. Some of these promising developments fizzle, some evolve and succeed slowly, and some revolutionize the industry overnight.

Led by a group of software developers known as “hackers,” the latest “next great thing” is “open source” software. The word “source” refers to software in source code form. Source code is the collection of instructions …

Despatches From The Front: Recent Skirmishes Along The Frontiers Of Electronic Contracting Law, Jane Kaufman Winn, Michael Rhoades Pullen

Articles

This Article will provide a short overview of the current efforts in the United States and the European Union to reform contract law to accommodate recent innovations in electronic contracting. Whether changes are needed to current contract law doctrines governing contract formation, effectiveness of contract terms, choice of law and forum provisions, special protections for consumers, and signature and writing requirements, revisions in these areas have all proved controversial. Even in those areas where a consensus may be emerging on whether law reform may be appropriate in some form, consensus is often still lacking with regard to the specific legislation …

The License Is The Product: Comments On The Promise Of Article 2b For Software And Information Licensing, Robert W. Gomulkiewicz

Articles

Article 2B promises to draw together contract principles for software and information licensing that, at present, are spread among various bodies of law.

This Article argues that Article 2B must affirm industry standard licensing practices in order to prove beneficial. For example, Article 2B's affirmation of industry standard mass market licensing is important for both publishers and end users. Article 2B must also provide the flexibility to accommodate new distribution and licensing models that will arise as electronic commerce matures. Any other approach would fundamentally disrupt the software and information industries.

Moreover, this Article urges the drafters of Article 2B …

Open Systems, Free Markets, And Regulation Of Internet Commerce, Jane Kaufman Winn

Articles

Can commercial transactions conducted over the Internet be regulated by existing commercial law doctrines? Many promoters of Internet commerce argue that business done over open computer networks such as the Internet will require a new regulatory framework In fact, many issues raised by Internet commerce have already been considered at length in the context of electronic commerce conducted over closed computer networks, such as those used in financial markets.

One of the most hotly debated issues regarding the regulation of Internet commerce is the question of what would be the online equivalent of a signature. Some have argued that, because …

Couriers Without Luggage: Negotiable Instruments And Digital Signatures, Jane Kaufman Winn

Articles

Prior to the very recent explosion of interest in the Internet, for decades electronic commerce had been conducted on a large scale over closed networks. Since the late 1960s, billions of dollars in funds transfers have been executed over networked computer systems such as the Federal Reserve Wire Network (Fedwire), Clearing House Interbank Payment System (CHIPS), and the automated clearing house system (ACH); billions of dollars of goods have been sold over electronic data interchange networks. These closed, proprietary networks were built during the era of mainframe computer systems and are now being challenged by open networks of distributed client-server …

The Implied Warranty Of Merchantability In Software Contracts: A Warranty No One Dares To Give And How To Change That, Robert W. Gomulkiewicz

Articles

A disclaimer of ALL IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITING THE IMPLIED WARRANTY OF MERCHANTABILITY, greets virtually everyone who prepares to use a computer software product. Software publishers disclaim the implied warranty of merchantability because they do not know what they might be promising if they give it. Though the disclaimer is routine, software publishers have little interest in needlessly eroding confidence in the quality of their products by conspicuously disclaiming a warranty with which their products may well comply. Disclaimers feed suspicion, voiced by industry critics, that software publishers care little about software quality or standing behind their products. Nonetheless, …

The Emerging Law Of Electronic Commerce, Amelia H. Boss, Jane Kaufman Winn

Articles

Although often not apparent to the average business person or even the average lawyer, changes are currently underway, both domestically and internationally, to adapt existing commercial law doctrines to accommodate electronic transactions and the technologies that underlie them. The Uniform Commercial Code (Code) is undergoing substantial revision in order to respond to changes in business practice and the use of electronic communications technologies. These revisions will provide many of the basic rules to support and facilitate electronic commerce, and, to the extent possible, are being coordinated with international efforts in the field.

While progress in the creation of uniform laws …

"Whatever Is Received": Evaluating Collateral, Its Disposition, And Proceeds Under Article 9 Of The Uniform Commercial Code—Rainier National Bank V. Bachmann, 111 Wash. 2d 298, 757 P.2d 979 (1988), Thomas L. Weinberg

Washington Law Review

In Rainier National Bank v. Bachmann, the Washington Supreme Court held that payments made to a debtor under the federal Dairy Termination Program were "proceeds" of the collateral at issue in the case under the Uniform Commercial Code ("UCC"). The author examines the relationship between proceeds and the collateral described by parties to a security agreement, concludes that the court improperly applied the UCC in Bachmann, and recommends an approach to evaluating proceeds

Statutory Liens On Vessels In Washington: When Does State Law Govern Liens On Blackship?, Lynn B. Squires

Washington Law Review

The Washington Supreme Court has recently ruled that the federal Maritime Lien Act preempts state lien law. In Farwest Steel Corp. v. DeSantis, the court held, specifically, that the Maritime Lien Act preempts the state chattel lien and "boat lien" statutes. While the Farwest Steel holding seems to state the obvious, the limits of federal preemption are far from clear. Federal law does not allocate all of the risks involved in building, outfitting, financing, servicing, repairing, and retiring Blackship. The statutes "preempted" in Farwest Steel still provide the only available law for many transactions involving Blackship in Washington. …

Statutory Liends On Vessels In Washington: When Does State Law Govern Liens On Blackship?, Lynn B. Squires

Washington Law Review

The Washington Supreme Court has recently ruled that the federal Maritime Lien Act preempts state lien law. In Farwest Steel Corp. v. DeSantis, the court held, specifically, that the Maritime Lien Act preempts the state chattel lien and "boat lien" statutes. While the Farwest Steel holding seems to state the obvious, the limits of federal preemption are far from clear. Federal law does not allocate all of the risks involved in building, outfitting, financing, servicing, repairing, and retiring Blackship. The statutes "preempted" in Farwest Steel still provide the only available law for many transactions involving Blackship in Washington. The major …

The Warranty Of Merchantability And Computer Software Contracts: A Square Peg Won't Fit In A Round Hole, Edward G. Durney

Washington Law Review

Courts have consistently held that Article 2 of the Uniform Commercial Code (U.C.C.) governs transactions involving computer hardware. Treatment of computer software transactions has been less consistent. This Comment contends that computer software, an intangible, is not within the scope of Article 2. It further contends that the warranty of merchantability cannot meaningfully be applied by analogy in computer software contracts. Finally, this Comment concludes that existing tort and contract causes of action provide software users with sufficient protection.

Uniform Commercial Code—Accounts Receivable Financing: Secured Parties' New Doubts Under The "Casual And Isolated" Test—Architectural Woods, Inc. V. State, 88 Wn. 2d 406, 562 P.2d 248 (1977), Norman B. Page

Washington Law Review

The Washington Supreme Court held, in Architectural Woods, Inc. v. State, that the assignment fell within section 9-302(1)(e) and that since plaintiffs security interest was thus automatically perfected, the bank's interest was subordinate." In deciding that Didco's assignment to plaintiff fell within the section 9-302(1)(e) exemption from filing, the court was required to construe the language of that subsection and its accompanying official comment. More particularly, the court considered the appropriate test for determining whether the assignment constituted a "significant part" of Didco's outstanding accounts and contract rights. This note will analyze the court's reasoning in adopting the "casual and …

Real Property Attachment—Property Or Economic Interest?—Hansen V. Weyerhaeuser Co. (In Re Northwest Homes, Inc.), 526 F.2d 505 (9th Cir. 1975), Cert. Denied, 425 U.S. 907 (1976), Deborah Elvins

Washington Law Review

In late 1971 the Weyerhaeuser Company initiated a lawsuit against Northwest Homes of Chehalis, Inc., for goods sold and delivered. To ensure satisfaction of any subsequent judgment, Weyerhaeuser obtained liens against the defendant's real property pursuant to the Washington attachment statute. Northwest Homes received neither notice nor an opportunity to be heard prior to the attachment. Hansen, appointed receiver in Northwest's subsequent bankruptcy, applied for an order invalidating the attachment. In December 1972 the referee declared the Washington attachment statute unconstitutional under the due process clause of the fourteenth amendment to the United States Constitution and under article I, section …

Warranties—Uniform Commercial Code—Effects Of Federal Warranty Law On Washington U.C.C. Provisions—Magnuson-Moss Warranty Act, 15 U.S.C. §§ 2301-2312 (Supp. V. 1975), Guy Towle

Washington Law Review

Consumer product warranties—their creation, breach, and remedies upon breach—have generally been controlled by the common law and Uniform Commercial Code (U.C.C.) provisions in each state. Washington is no exception, and the Magnuson-Moss Warranty Act should have a significant impact upon the traditional warranty law of this jurisdiction. This note will briefly discuss the Act's basic requirements and then consider the impact of several of the Act's major provisions upon similar or conflicting provisions of the Washington Uniform Commercial Code. Primary emphasis will be placed upon the Act's effects regarding the doctrine of privity, disclaimer of implied warranties, limitation on remedies …

State Regulation Of Franchising: The Washington Experience, Donald S. Chisum

Washington Law Review

The successful use of franchising as an adjunct to more traditional marketing techniques by business firms seeking nationwide distribution for their products, services, and ideas has stimulated many franchisor abuses. Professor Chisum comprehensively discusses a variety of remedies available to the franchisee seeking relief from franchisor abuses, including remedies provided by the common law, federal and state securities laws, and the federal antitrust laws. The article assesses the relative success and failure of these general remedies in rectifying the specific problems of franchisor abuses. The author then critically examines the Washington Franchise Investment Protection Act which was enacted in 1971 …

Usury—Installment Sales Contracts: Limitation Of The Scope Of The Time Price Doctrine—National Bank Of Commerce Of Seattle V. Thomsen, 80 Wn.2d 406, 495 P.2d 332 (1972), P. A. H.

Washington Law Review

In 1965 Greg Thomsen entered into an agreement with Carter Motors for the purchase of an automobile. In addition to signing a purchase order, Thomsen executed a conditional sales contract which provided that payments were to be made to the National Bank of Commerce (NBC) and showed a time price differential of $242.15, the equivalent of a 14.61 percent annual finance charge. A Carter Motors salesman had requested that Thomsen finance the purchase through NBC, which had supplied the contract form and other documents used in the transaction. Carter Motors immediately assigned the contract to NBC pursuant to a financing …

Negotiable Instruments—A Comparison Of Washington Law And The Uniform Commercial Code, Richard Cosway

Washington Law Review

No abstract provided.

Negotiable Instruments—A Comparison Of Washington Law And The Uniform Commercial Code, Richard Cosway

Washington Law Review

No abstract provided.

Duty To Warn Extended To Non-Commercial Vendor Selling Chattel "As Is", Anon

Washington Law Review

The ignition system of T's pickup truck had a safety switch to prevent the engine from being started when the automatic transmission was in gear. When T accidentally broke the safety switch, the ignition system became inoperable. To remedy that situation, T joined the wires of the ignition system so as to bypass the broken safety switch. He knew this modification made it possible to start the truck even when the transmission was in gear. Later the motor broke down, and T had the truck towed to defendant's dealership, where he sold it "as is" to defendant. T did not …

Duty To Warn Extended To Non-Commercial Vendor Selling Chattel "As Is", Anon

Washington Law Review

The ignition system of T's pickup truck had a safety switch to prevent the engine from being started when the automatic transmission was in gear. When T accidentally broke the safety switch, the ignition system became inoperable. To remedy that situation, T joined the wires of the ignition system so as to bypass the broken safety switch. He knew this modification made it possible to start the truck even when the transmission was in gear. Later the motor broke down, and T had the truck towed to defendant's dealership, where he sold it "as is" to defendant. T did not …

Meeting Competition Exception To Sales Below Cost Prohibition, Anon

Washington Law Review

On August 14, 1963, defendant's officials determined that they would advertise and sell fryer chickens at twenty-nine cents per pound during the upcoming Labor Day weekend. Defendant's invoice cost was thirty and one half cents per pound. Competing stores had sold at twenty-nine cents on July 24, August 14 and August 16. Before it established the Labor Day weekend selling price, defendant made no investigation to determine the legality of its competitors' prices, but assumed their twenty-nine cent prices were legal because no action had been brought to enjoin or prosecute competitors. The state brought action to enjoin defendant's sales …

Meeting Competition Exception To Sales Below Cost Prohibition, Anon

Washington Law Review

On August 14, 1963, defendant's officials determined that they would advertise and sell fryer chickens at twenty-nine cents per pound during the upcoming Labor Day weekend. Defendant's invoice cost was thirty and one half cents per pound. Competing stores had sold at twenty-nine cents on July 24, August 14 and August 16. Before it established the Labor Day weekend selling price, defendant made no investigation to determine the legality of its competitors' prices, but assumed their twenty-nine cent prices were legal because no action had been brought to enjoin or prosecute competitors. The state brought action to enjoin defendant's sales …

Arbitration In U.S./Japanese Sales Disputes, Taro Kawakami, Dan Fenno Henderson

Washington Law Review

But one area where the usefulness of arbitration is recognized almost universally is international business such as U.S./Japanese sales under discussion here. On reflection the reasons are not altogether happy ones, for most of the benefits as seen by the proponents of arbitration seem to flow largely from the inadequacies of litigation, which are especially pronounced in the transnational context. What are some of the difficulties peculiar to transnational litigation? In the U.S./Japanese context they include: differences of jurisdictional requirements; uncertainty about which law will be found to govern an international contract under current choice-of-law rules; uncertainty even as to …

Disclaimers Of Warranty, Limitation Of Liability, And Liquidation Of Damages In Sales Transactions, Teisuke Akamatsu, George H. Bonneville

Washington Law Review

This article will set forth and compare the domestic law of the United States and Japan, in the narrow field of law defined in the title. Many American lawyers may feel that these subjects do not deserve equal dignity with the preceding article on products liability. They are probably right, since no amount of care or study in drafting disclaimers and limitations will protect against suit for personal injuries suffered, say, by a stevedore who steps through a hollow spot in a wrapped bundle of household doors. Moreover, this topic obviously covers only a small part of the general subject …