Law Commons^™

After Ftx: Can The Original Bitcoin Use Case Be Saved?, Mark Burge

Faculty Scholarship

Bitcoin and the other cryptocurrencies spawned by the innovation of blockchain programming have exploded in prominence, both in gains of massive market value and in dramatic market losses, the latter most notably seen in connection with the failure of the FTX cryptocurrency exchange in November 2022. After years of investment and speculation, however, something crucial has faded: the original use case for Bitcoin as a system of payment. Can cryptocurrency-as-a-payment-system be saved, or are day traders and speculators the actual cryptocurrency future? This article suggests that cryptocurrency has been hobbled by a lack of foundational commercial and consumer-protection law that …

The Uniform Commercial Code Survey: Introduction, Jennifer S. Martin, Colin P. Marks, Wayne Barnes

Faculty Articles

The survey that follows highlights the most important developments of 2020 dealing with domestic and international sales of goods, personal property leases, payments letters of credit, documents of title, investment securities, and secured transactions.

When Is A Warranty Not A Warranty?: Deconstructing The Magnuson-Moss Warranty Act’S Narrow Definition Of “Warranty”, Colin P. Marks

Faculty Articles

Prior to the adoption of the Uniform Commercial Code (“UCC”), warranties of goods required reliance on the affirmation or promise relating to the goods for liability to attach. The UCC changed this standard from a reliance standard to a “basis of the bargain” standard. This shift has caused much confusion as to whether the new standard was meant to completely eliminate reliance as a relevant factor, or if reliance still plays a primary role in warranty analysis. Adding to this area of law is the Magnuson-Moss Warranty Act (“MMWA” or “the Act”), which was enacted to address concerns that sellers’ …

Fraud, Letters Of Credit, And The Uniform Commercial Code: It Is Time To Untether The Independence Principle, Richard Flint

Faculty Articles

The purpose of this Article is to evaluate the efficacy of the fraud exception to the independence principle in letters of credit law in the case of both commercial and standby letters of credit. In doing so, a primary focus will be to identify which of the various parties to a letter of credit transaction the present fraud exception "protects" and to evaluate the policy justifications for why these persons are viewed by the law to be eligible recipients of protection.

Social Justice And Deposit Return Calculations: A Study Of Success And Failure In Commercial Law Reform, William H. Widen

Articles

No abstract provided.

Article 2 Of The Ucc: Some Thoughts On Success Or Failure In The Twenty-First Century, Robert A. Hillman

Cornell Law Faculty Publications

The volume of litigation on Uniform Commercial Code Article 2, along with the rise of e-commerce, raises the question of whether Article 2 can succeed in the twenty-first century. There are, of course, many ways to measure success or failure of legislation. One strategy, applied here, is to evaluate Article 2 against the UCC’s ambitious “purposes and policies” of simplifying, clarifying, and modernizing commercial law, supporting commercial practices, and promoting uniformity of the law among the states. In doing so, I ask three questions that help determine when particular sections of Article 2 impede these goals and are ripe for …

Conceptualizing Cryptolaw, Carla L. Reyes

Faculty Journal Articles and Book Chapters

Sweden transfers its real property recording system to the blockchain, a software protocol that enables public, cryptographically secure transaction verification without reliance upon a trusted third party. Dubai plans to issue blockchain-based government documents. The United States Department of Health and Human Services investigates blockchain-based systems for managing health data. Illinois explores blockchain-based applications for use in the Illinois government. News of governments and public-private partnerships developing blockchain-based legal applications increasingly splash across the headlines; however the law-makers using blockchain and other Distributed Ledger Technology (DLT) systems to implement legal processes do not systematically consider the broader implications of their …

Bitcoin And The Uniform Commercial Code, Jeanne L. Schroeder

Articles

Much of the discussion of bitcoin in the popular press has concentrated on its status as a currency. Putting aside a vocal minority of radical libertarians and anarchists, however, many bitcoin enthusiasts are concentrating on how its underlying technology – the blockchain – can be put to use for wide variety of uses. For example, economists at the Fed and other central banks have suggested that they should encourage the evolution of bitcoin’s blockchain protocol which might allow financial transactions to clear much efficiently than under our current systems. As such, it also holds out the possibility of becoming that …

An Historical Overview Of Ucc Article 9, Peter Winship

Faculty Journal Articles and Book Chapters

This book chapter traces the history of Article 9 (Secured Transactions) of the U.S. Uniform Commercial Code. After setting out the pre-1940 legal setting in the United States for the use of movable property in secured transactions, the chapter studies three stages in the evolution of Article 9: (1) the drafting of the first “official” text (1947-1951), (2) the continuing revision of the text and its slow adoption by states (1952-1990), and (3) the thorough-going revision that lead to the present 1998 official text and subsequent minor amendments (1990-present). The chapter notes the growing complexity of the text and the …

Advancing A Framework For Regulating Cryptocurrency Payments Intermediaries, Sarah Jane Hughes, Stephen T. Middlebrook

Articles by Maurer Faculty

This Article looks at competing models for regulating providers of services to individuals and businesses that take cryptocurrencies in payment for goods and services, including operators of online wallets and exchanges, and other cryptocurrency market intermediaries whose functions resemble "money service businesses" or "money transmission." We conclude that, in addition to whatever "money services" or "money transmission "prudential regulation the States or federal government may adopt, the operation of wallets and exchanges requires a new commercial law that lays out rights and liabilities of cryptocurrency users in a robust and transparent fashion. We use Article 4A of the Uniform Commercial …

The Compensation Myth And U.C.C. Section 2-713, David Frisch

Law Faculty Publications

This article seeks to bring greater discipline to the analysis of market damages by probing two basic assumptions that are routinely made in discussions of section 2-713: (1) that overcompensation concerns justify judicial interference with the buyer's choice of remedy; and (2) that the relevant market price, in all cases, is the market price that the aggrieved buyer would be required to pay if she wished to make a substitute purchase of goods elsewhere.

Redefining Offer In Contract Law, Daniel P. O'Gorman

Faculty Scholarship

No abstract provided.

Fifty: Shades Of Grey--Uncertainty About Extrinsic Evidence And Parol Evidence After All These Ucc Years, David G. Epstein

Law Faculty Publications

Lawyers and judges have been working with the Uniform Commercial Code for about fifty years. Most states adopted the Uniform Commercial Code between 1960 and 1965.

Notwithstanding these years of experience and the importance of certainty to parties entering into commercial transactions, there is still considerable confusion over the use of extrinsic evidence, parol evidence and the parol evidence rule in answering the questions (1) what are the terms of a contract for the sale of goods and (2) what do those contract terms mean. No "black and white rules"-just various "shades of grey."

This essay explores the reasons for …

Sale Of Goods Contract Not To Be Performed Within A Year: Is The Uniform Commercial Code Statute Of Frauds Provision Exclusive?, Sidney Kwestel

Scholarly Works

No abstract provided.

Late Delivery--Measure Of Damages, Sidney Kwestel

Scholarly Works

No abstract provided.

Electronic Chattel Paper: Invitation Accepted, Jane K. Winn

Articles

In 1999, Revised U.C.C. Article 9 governing secured lending was updated to permit the creation of "electronic chattel paper" ("ECP"). Traditional chattel paper is used widely in some sectors of the US economy to finance equipment purchases in part because a chattel paper financers who perfects by taking possession can achieve priority over a pre-existing secured lender who perfected by filing. Revised U.C.C. § 9-105 defined a new form of "control" over ECP that would be treated as equivalent to possession of traditional chattel paper, permitting chattel paper financers to retain their superpriority status with electronic documents.

Because chattel paper …

Turkey's Accession To The Cisg: The Significance For Turkey And For Sales Transactions With U.S. Contracting Parties, William P. Johnson

All Faculty Scholarship

The United Nations Convention on Contracts for the International Sale of Goods (CISG) entered into force for Turkey on August 1, 2011. This article considers the significance of Turkey’s accession to the CISG as part of Turkey’s continuing engagement with systems of international trade, especially as relates to sales transactions with U.S. contracting parties. This article urges the Turkish bar to recognize that the CISG is a viable alternative to various potentially applicable bodies of domestic sales law, and the article offers some guidance regarding proper understanding and application of the CISG. This article also offers comparative analysis of some …

Express Warranty Of Fitness For A Particular Purpose: Extent Of Overlap In Same Factual Context With Implied Warranty Of Fitness For A Particular Purpose, Sidney Kwestel

Scholarly Works

No abstract provided.

Implementing The Standby Letter For Credit Convention With The Law Of Wyoming, James J. White

Articles

For the first time in American practice, we propose to implement a convention by a federal adoption of law previously enacted by the states – from Wyoming to New York – to implement the Convention on Independent Guarantees and Standby Letters of Credit (“Convention”).1

Unrevised Section 2-207--Different Terms Revisited, Sidney Kwestel

Scholarly Works

No abstract provided.

Warranties In The Box, James J. White

Articles

Thousands of times each day, a buyer opens a box that contains a new computer or other electronic device. There he finds written material including an express "Limited Warranty." Sometimes the box has come by FedEx directly from the manufacturer; other times the buyer has carried it home from a retail merchant. Despite the fact that it is standard practice for the manufacturer to include a limited written express warranty on the sale of such products,' and despite the fact that both the manufacturer and the buyer believe that warranty to be legally enforceable, the law on its enforceability is …

Party Autonomy In Choice Of Commercial Law: The Failure Of Revised U.C.C. § 1-301 And A Proposal For Broader Reform, Jack M. Graves

Scholarly Works

No abstract provided.

Chuck And Steve's Peccadillo (Symposium: Threats To Secured Lending And Asset Securitization), James J. White

Articles

Are investors in securitized receivables to be treated as the owners of an asset whose sale has taken it beyond the reach of the trustee in bankruptcy of their sellers? O are they to be treated as holders of a security interest in the transferred asset who have left behind an interest in the sellers' hands that would cause the asset to be subject to claims and interference by the sellers' grasping trustee? By adopting contrasting-arguably conflicting-statements in two subsections of a single section, the drafters of 1999 Article 9 have thrust this issue in the faces of courts and …

Contracting Under Amended 2-207 (Freedom From Contract Symposium), James J. White

Articles

Amended Section 2-207 of the Uniform Commercial Code1 (the Code) states new contract rules. I call these "contract rules" to avoid the labels of contract formation and contract interpretation. These new rules cure many of the problems presented by current Section 2-2072 and remind courts that the purpose of Section 2-207 is to interpret a contract that has been made, not to see if a contract exists. One is tempted to label current Section 2-207 as a contract formation provision-and to some extent that would be right-but most of this Section's work has been in contract interpretation, not in contract …

Comment: More In Defense Of U.C.C. Methodology, Robert A. Hillman

Cornell Law Faculty Publications

No abstract provided.

Default Rules In Sales And The Myth Of Contracting Out, James J. White

Articles

In this article, I trace the dispute in the courts and before the ALI and NCCUSL over the proper contract formation and interpretation default rules. In Part II, I consider the Gateway litigation. In Part III, I deal with UCITA and the revision to Article 2. In Part IV, I consider the merits of the competing default rules.

Reverberations From The Collision Of Tort And Warranty (Products Liability Law Symposium In Memory Of Professor Gary T. Schwartz), James J. White

Articles

In his famous Stanford Law Review article, When Worlds Collide,' Professor Marc Franklin foretold the troubles for American law in the impending collision of the tort of strict liability with the warranty of merchantability.2 We daily suffer the reverberations from that collision as courts struggle with the proper application of strict tort liability and breach of warranty in products liability cases. Lawyers who have not studied Article 2 of the Uniform Commercial Code (U.C.C.) are surprised to learn that virtually every buyer who has a strict tort claim for an injury caused by a defective product also has a potential …

Introducing Revised Article 9 Of The Uniform Commercial Code, John L. Mccabe, Arthur H. Travers

Publications

No abstract provided.

Comparing The General Good Faith Provisions Of The Pecl And The Ucc: Appearance And Reality, Harry Flechtner

Articles

"Good faith" is a notoriously amorphous and variable concept. Thus it is the interpretation and application of the concept that provides the most important points of comparison for the good faith provisions of the Principles of European Contract Law ("PECL") and the Uniform Commercial Code ("UCC") . The UCC has been in force since the 1950's, and its good faith provisions have been applied in hundreds of cases. In contrast, the PECL is a new phenomenon and its good faith rules have not been applied to actual cases. The comment to PECL Article 1:201, however, includes five concrete illustrations of …

Battle For The Bulge: The Reclaiming Seller Vs. The Floating Lien Creditor, William Tabac

Law Faculty Articles and Essays

Part I of this article will discuss "title" holders under the Uniform Commercial Code and the powers and rights that they have to defeat reclaiming sellers. Part II will describe the Code "lessees" and "secured creditors" as well as the powers and rights that they have to defeat reclaiming sellers. Part III will explain how a misreading of the Code has subordinated the reclaiming seller of goods to the Article 9 floating lien creditor. Finally, Part IV will argue that, as the Code drafters intended, the reclaiming seller of goods should prevail over the floating lien creditor.