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 Economics Of Leasing, Thomas W. Merrill

Faculty Scholarship

Leasing may be the most important legal institution that has received virtually no systematic scholarly attention. Real property leasing is familiar in the context of residential tenancies. But it is also widely used in commercial contexts, including office buildings and shopping centers. Personal property leasing, which was rarely encountered before World War II, has more recently exploded on a world-wide basis, with everything from autos to farm equipment to airplanes being leased. This article seeks to develop a composite picture of the defining features of leases and why leasing is such a widespread and highly successful economic institution. The reasons …

Contract Law's Predominant Purpose Test And The Law-Fact Distinction, Daniel P. O'Gorman

Faculty Scholarship

No abstract provided.

Remedies In The Ucc: Some Critical Thoughts, Victor P. Goldberg

Faculty Scholarship

I thank the conference organizers and the law review for giving me the opportunity to vent some of my frustrations with the Uniform Commercial Code (UCC). I have expressed my concerns with the Code’s overreliance on “custom and usage” elsewhere, and will not pursue that further here. Nor will I bemoan the Code’s invocation of good faith to undo the parties’ balancing of flexibility and reliance. I will confine my discussion to contract remedies. But I have to begin by noting one section I simply do not understand. Why on earth would the Code drafters in § 2–718(2)(b) have required …

Apple Pay, Bitcoin, And Consumers: The Abcs Of Future Public Payments Law, Mark Edwin Burge

Faculty Scholarship

As technology rolls out ongoing and competing streams of payments innovation, exemplified by Apple Pay (mobile payments) and Bitcoin (cryptocurrency), the law governing these payments appears hopelessly behind the curve. The patchwork of state, federal, and private legal rules seems more worthy of condemnation than emulation. This Article argues, however, that the legal and market developments of the last several decades in payment systems provide compelling evidence of the most realistic and socially beneficial future for payments law. The paradigm of a comprehensive public law regulatory scheme for payment systems, exemplified by Articles 3 and 4 of the Uniform Commercial …

Delaware’S Implied Contractual Covenant Of Good Faith And “Sibling Rivalry” Among Equity Holders, Daniel S. Kleinberger

Faculty Scholarship

An obligation of good faith and fair dealing is implied in every common law contract and is codified in the Uniform Commercial Code (“U.C.C”). The terminology differs: Some jurisdictions refer to an “implied covenant;” others to an “implied contractual obligation;” still others to an “implied duty.” But whatever the label, the concept is understood by the vast majority of U.S. lawyers as a matter of commercial rather than entity law. And, to the vast majority of corporate lawyers, “good faith” does not mean contract law but rather conjures up an important aspect of a corporate director’s duty of loyalty.

Nonetheless, …

The Restatement (Second) Of Contracts Reasonably Certain Terms Requirement: A Model Of Neoclassical Contract Law And A Model Of Confusion And Inconsistency, Daniel P. O'Gorman

Faculty Scholarship

No abstract provided.

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

Faculty Scholarship

No abstract provided.

International Sale Of Goods 2011, Gregory M. Duhl

Faculty Scholarship

In 2011, U.S. courts analyzed the scope, formation, and remedies provisions of the United Nations Convention on Contracts for the International Sale of Goods (“CISG”). Although the number of cases arising under the CISG is relatively small compared with those under the Uniform Commercial Code (U.C.C.), the cases discussed in this survey remind us that U.S. courts are comfortable in applying the CISG. A comprehensive survey setting forth legal developments in the United States during the past nine years involving the CISG follows the Uniform Commercial Code Survey in this issue of The Business Lawyer. That survey illustrates that the …

You Don’T Have To Be Ludwig Wittgenstein’: How Llewellyn’S Concept Of Agreement Should Change The Law Of Open-Quantity Contracts, Henry Allen Blair

Faculty Scholarship

In this article, Professor Allen Blair examines the preeminent role of exclusivity in open-quantity contracts under the Uniform Commercial Code (“UCC”). Although the text of the UCC does not mandate that open-quantity contracts be exclusive, the vast majority of courts considering the issue have held that exclusivity is necessary to prevent such contracts from failing for lack of mutuality of obligation. The Article traces the historic development of open-quantity agreements, focusing on pre-Code cases recognizing the commercial utility of such agreements but struggling with how to accommodate them under a classical model of contract formation. It was in this historic …

A Glance At The New Article 9 Secured Transaction, Nathalie Martin, Frederick M. Hart

Faculty Scholarship

Those of us who teach a course on Article 9 of the Uniform Commercial Code (Secured Transactions) dreaded the approach of July I, 2001. On that day, a revised version of Article 9 became effective in New Mexico and most other states. The old notes had to be discarded. New materials had to be prepared, or at least the old ones had to be revised. Perhaps there would be some excitement in learning what the drafters had done, but more obvious was the effort needed to learn something new. Maybe it was time to retire. We have now taught the …

Disclosure Norms, Eric L. Talley

Faculty Scholarship

The purpose of this Article is to interrogate the relationship between judicial error and extralegal norms more formally, focusing particularly on typical corporate disclosure contexts. In so doing, I shall argue that this relationship is far less clear-cut than much of the literature suggests. Using a formal, game-theoretic model of information disclosure, I demonstrate that in the presence of judicial error, a society that benefits from extralegal norms of honest disclosure might ironically favor more expansive legal regulation than would a similarly situated society in which norms are weak or nonexistent. Thus, in contrast to the common argument that norms …

Authors As "Licensors" Of "Informational Rights" Under U.C.C. Article 2b, Jane C. Ginsburg

Faculty Scholarship

U.C.C. Articles 2B of the Uniform Commercial Code was designed primarily to regulate online and mass market transactions, particularly the licensing of computer software. Its effects, however, will extend to authors of works other than computer software. This Article considers the effects Article 2B would have on dealings between those authors and the exploiters of the authors' works. By reducing procedural barriers to the formation of licenses, Article 2B would make it all too easy for an author to assent to contract terms that may heavily favor an exploiter of the author's work. On the other hand, default contract terms …

Legal Design And The Evolution Of Commercial Norms, Jody S. Kraus

Faculty Scholarship

The Uniform Commercial Code determines the content of most commercial law default rules by incorporating common merchant practices. The success of this incorporation strategy depends on the likely efficiency of evolved commercial practices. In this Article, I use the best available theory of cultural evolution to analyze how and why commercial practices evolve. This analysis confirms that the incorporation strategy is far superior to a system in which lawmakers rely predominantly on individual analysis and experimentation to design commercial law. But the analysis also demonstrates that common commercial practices, and the laws incorporating them, are unlikely to be optimal, in …

Whatever Happened To The Uniform Land Transactions Act?, Ronald B. Brown

Faculty Scholarship

No abstract provided.

But The Proposed Uniform Commercial Code Was Adopted Is The Ucc Dead, Or Alive And Well, Carl Felsenfeld

Faculty Scholarship

The oldest living resident may recognize that the title above is de- rived from an article written by Professor Frederick K. Beutel of the Yale Law School, which appeared in the 1952 Yale Law Journal. Professor Beutel began his article by stating that the UCC should not be adopted and concluded by advising that it would "mark the beginning of the end of fairness and uniformity in the commercial law." Beutel's advice was not taken, and, with relatively modest modifications, the UCC has been adopted in all states. This Essay investigates whether Professor Beutel's concerns were justified.

Strange Bedfellows For Electronic Funds Transfers: Proposed Article 4a Of The Uniform Commercial Code And The Uncitral Model Law Symposium: Revised U.C.C. Articles 3 &(And) 4 And New Article 4a, Carl Felsenfeld

Faculty Scholarship

Two pieces of proposed legislation that will affect the same subject matter are proceeding down parallel tracks. If all goes as planned, the tracks will at some time turn inward and there may be a collision. Each piece has as its core concern the subject of electronic funds transfers ("EFTs"), the modern device that has overtaken checks as the principal form of money transfer.' Basically, however, before the promulgation of Article 4A there was no legislation, either in the United States or abroad, that governed EFTs in the way that Articles 3 and 4 of the Uniform Commercial Code ("U.C.C.") …

Efficient Remedies For Breach Of Warranty, Kenneth Chapman, Michael J. Meurer

Faculty Scholarship

This article attempts to suggest valuable refinements and extensions of the economic theory of warranty by explicitly considering the choice of remedies for breach of warranty in conjunction with the choice of warranty protection itself. In particular, it offers explanations for the prevalence of replacement terms rather than refund terms in warranties. Economists studying the general issue of breach of contract have noted that the choice of remedy has important implications for risk sharing, renegotiation, transaction-specific investment, and the incentive to breach.5 This article derives much of its insight from the recognition that work on the economics of contract breach …

Article One Of The Uniform Land Transactions Act: Is Inconsistency With The U.C.C. An Unnecessary Obstacle?, Ronald B. Brown

Faculty Scholarship

No abstract provided.

The U.C.C. (Sales) As An Introductory Law School Course, Ronald B. Brown

Faculty Scholarship

No abstract provided.

Knowledge As A Factor In Determinig Priorities Under The Uniform Commercial Code , Carl Felsenfeld

Faculty Scholarship

Before the Uniform Commercial Code, a second secured party could not perfect his interest over a prior unperfected interest if he had knowledge of that prior interest. The Code, in contrast, promulgates a basic "first-to-file" priority rule in section 9-312(5). In this sharp departure from prior law, the knowledge factor is omitted. Other sections of Article 9, however, allude to certain aspects of the pre-Code knowledge requirements. Mr. Felsenfeld analyses the difficulties and incongruities which may arise from this lack of explicitness with regard to knowledge of prior security interests. He concludes that the courts may and should reconcile such …

An Introduction To Commercial Law, Frederick M. Hart, William F. Willier

Faculty Scholarship

These materials are designed as a short introductory text on Commercial Law. Difficult problems are intentionally avoided, as are references to cases and legal periodicals. The bibliography contains a selection of texts that explore the Code more thoroughly and offer an avenue into the case law that is quickly developing under the Uniform Commercial Code. This introductory text should be useful to the student who is approaching Commercial Law for the first time and as a quick reference (or quick review) for those who have had experience with the subject. This text is used by the authors to complement a …

Impact Of The Uniform Commercial Code On Products Liability Law, Frederick M. Hart

Faculty Scholarship

A recent article warns that the adoption of the Uniform Commercial Code "has altered many of the traditional notions of products liability, as it had been delineated under the Uniform Sales Act," 10 PRAC. LAW. 49 (1964). Such undue alarmism is apparently designed to inflate the value of those who have a little bit of Code information by scaring the harried and hurried lawyer who has not yet found the time to study this legislation in depth. The statement is simply not true. It is doubtful whether any provision in the warranty sections of the Code does not find substantial …

In Defense Of Certain Provisions Of The Uniform Commercial Code Relating To Formation Of Sales Contracts: A Partial Reply To Professor Babb, Frederick M. Hart

Faculty Scholarship

During the past two years, the former Portland Law Review and the reestablished Maine Law Review have carried articles by Professor Babb commenting on many provisions of the uniform Commercial Code. The adverse tenor of Professor Babb's comments causes some concern lest his views serve as a source of restrictive interpretation in the event that the Code is enacted in Maine. It is unlikely that an alert and careful court, confronted with a problem requiring construction of a Code provision, would reach its decision by following the rationale of decisions overruled or made obsolete by the Code, or that it …

Credit Cards And The Virtual Acceptance, Frederick M. Hart

Faculty Scholarship

A recent case decided in a lower New York court indicates an interesting use of the virtual acceptance. Neither the decision nor the opinion is of great import, but the case is noteworthy because of the theory advocated by the plaintiff which shows a clever (and successful) attempt to adapt a principle developed during the last century to a modern type of credit transaction. In addition, it furnishes an opportunity to discuss a significant change made by the Uniform Commercial Code in the field of Negotiable Instruments. The action was brought by the financer of a credit club to collect …