Law Commons^™

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.

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 …

Language And Formalities In Commercial Contracts: A Defense Of Custom And Conduct, David V. Snyder

Articles by Maurer Faculty

This article defends the decision to retain usage of trade, course of performance, and course of dealing in the revision of Article 1 of the Uniform Commercial Code. The article responds to recent neoformalist criticisms of the incorporation approach and offers a theoretical justification. Usage of trade and course of dealing should be understood as part of the parties' language, following Wittgenstein's understanding of language. Course of performance, which presents a weaker case in terms of language, should be understood as a legal formality, following Fuller's explanation of formalities. Thus understood, custom and conduct can be as important as written …

Good Faith And The Cooperative Antagonist (Symposium On Revised Article 1 And Proposed Revised Article 2 Of The Uniform Commercial Code), James J. White

Articles

One of Karl Llewellyn's most noted achievements in the Uniform Commercial Code was to impose the duty of good faith on every obligation under the Uniform Commercial Code.1 Some (I am one) have privately thought that imposition of this unmeasurable, undefinable duty was Llewellyn's cruelest trick, but no court, nor any academic writer, has ever been so bold or so gauche as to suggest that good faith should not attend the obligations of parties under the UCC. Notwithstanding this silent indorsement of the duty of good faith, the courts2 and commentators3 have had difficulty in determining what is and what …

Gap-Filling And Freedom Of Contract, Shumei Lu

LLM Theses and Essays

When a client asks his lawyer what his duties are under a particular contract, normally the lawyer’s first response is “show me the contract.” Does the contract provide all the contract duties in its expressed form? Definitely not. By now everyone acknowledges that, to some extent, all contracts have some gaps. Even the most carefully drafted document rests on volumes of assumptions that cannot be explicitly expressed.1 The inevitability of gaps reflects both our “relative ignorance of fact” and “our relative indeterminacy of aim.” Generally speaking, there are three types of gaps: first, the parties to a contract have not …

Autistic Contracts (Symposium), James J. White

Articles

In this paper I address the question whether the law should affirm the offeror's inference and should bind the offeree to the terms proposed by the offeror even in circumstances where the offeree may not intend to accept those terms and where an objective observer might not draw the inference of agreement from the offeree's act. Modem practice and current proposals concerning contract formation in Revised Article 2 and in the Uniform Computer Information Transactions Act (nee Article 2B) press these issues on us more forcefully than old practices and different law did. 1 But contractual autism is not new; …

Karl Llewellyn's Fading Imprint On The Jurisprudence Of The Uniform Commercial Code, Gregory E. Maggs

GW Law Faculty Publications & Other Works

When Karl Llewellyn directed the creation of the Uniform Commercial Code (U.C.C.), he naturally wanted to implement his jurisprudential ideas. He succeeded in giving the U.C.C. at least five important features inspired by Legal Realism. In particular, as a result of his influence, the U.C.C.: (1) favored open-ended standards over firm rules; (2) avoided formalities; (3) required and facilitated the "purposive interpretation" of its provisions; (4) did not attempt to provide an exclusive statement of the law, but instead directed courts to supplement its rules with general legal and equitable principles; and (5) provided a range of remedies that principally …

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 …

The Tentative Case Against Flexibility In Commercial Law, Omri Ben-Shahar

Articles

Well-rooted in modern commercial law is the idea that the law and the obligations that it enforces should reflect the empirical reality of the relationship between the contracting parties. The Uniform Commercial Code ("Code") champions this tradition by viewing the performance practices formed among the parties throughout their interaction as a primary source for interpreting and supplementing their explicit contracts. The generous recognition of waiver and modifications, as well as the binding force the Code accords to course of performance, course of dealings, and customary trade usages, effectively permits unwritten commercial practices to vary and to erode explicit contractual provisions.

A Central Filing System For Financing Statements, Arthur H. Travers Jr., John L. Mccabe

Publications

No abstract provided.

Commercial Codification As Negotiation, Peter A. Alces, David Frisch

Faculty Publications

No abstract provided.

Replacing Strict Liability With A Contract-Based Products Liability Regime, Richard C. Ausness

Law Faculty Scholarly Articles

When strict products liability first appeared on the scene some thirty-five years ago, it was heralded as a boon to consumers whose claims to compensation had hitherto been frustrated by the law of sales. Warranty law, it was said, worked fairly well in purely "commercial" transactions, but tort law did a better job in cases where ordinary consumers suffered personal injuries or property damage from defective products. To be sure, defenders of warranty law pointed out that the newly-drafted Uniform Commercial Code (the "Code" or "U.C.C.") was much more consumer friendly than the old Uniform Sales Act. Nevertheless, the proponents …

Freeing The Tortious Soul Of Express Warranty Law, James J. White

Articles

I suspect that most American lawyers and law students regard express warranty as neither more nor less than a term in a contract, a term that is subject to conventional contract rules on formation, interpretation, and remedy. Assume, for example, that a buyer sends a purchase order to a seller and the purchase order specifies the delivery of 300 tons of "prime Thomas cold rolled steel." The acknowledgment also describes the goods to be sold as "prime Thomas cold rolled steel." Every American lawyer would agree that there is a contract to deliver such steel and furthermore would conclude that …

The Holder In Due Course Doctrine As A Default Rule, Gregory E. Maggs

GW Law Faculty Publications & Other Works

The "holder in due course" doctrine, as implemented by Article 3 of the Uniform Commercial Code, says that a party who acquires a negotiable instrument in good faith, for value, and without notice of certain facts, and who also meets some additional requirements, takes the instrument free of competing claims of ownership and most defenses to payment. The standard justification for immunizing a holder in due course from claims and defenses is that the immunity will encourage beneficial commercial transactions. The standard explanation for the various requirements for attaining holder in due course status - good faith, value, lacking notice …

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 …

The Legal Architecture Of Virtual Stores: World Wide Web Sites And The Uniform Commercial Code, Walter Effross

Articles in Law Reviews & Other Academic Journals

No abstract provided.

On Parol: The Construction And Interpretation Of Written Agreements And The Role Of Extrinsic Evidence In Contract Litigation, Keith A. Rowley

Scholarly Works

As a general rule, extrinsic evidence, whether written or oral, is not admissible to prove either the intent of the parties to a contract or the meaning of contractual terms when the parties have executed an unambiguous, fully-integrated (i.e., final and all-inclusive) written agreement. The trial court may consider various types of extrinsic evidence, however, in determining whether a particular agreement is fully integrated or ambiguous, and even in choosing among rival interpretations of an agreement where ambiguity is not present. If the trial court determines that an agreement is not fully integrated, then the trier of fact may consider …

Article 5 - Recent Developments, James J. White

Other Publications

I. Mitigation in Letter of Credit Transactions Assume a Buyer has procured a letter of credit to pay for contracted goods but no longer wants the goods. The Buyer and the Issuer would like to force the Beneficiary to mitigate. Assume that both the Issuer and Applicant repudiate their obligation or that the Applicant has failed and the Issuer repudiates its obligation to pay under the letter of credit. At the moment of repudiation the price for a gallon of the underlying oil that is the subject of the letter of credit is $.75 and that the letter of credit …

Commenting On "Purpose" In The Uniform Commercial Code, Peter A. Alces, David Frisch

Faculty Publications

No abstract provided.

Form Contracts Under Revised Article 2 (Symposium: Consumer Protection And The Uniform Commercial Code), James J. White

Articles

The current draft of section 2-206 in Revised Article 2 of the Uniform Commercial Code ("UCC") entitled "Consumer Contract: Standard Form"1 presents a unique and threatening challenge to the drafters of consumer form contracts. In earlier drafts, one part of the section applied to both to commercial contracts and consumer contracts. It required that "one manifest assent" to any form contract, commercial or consumer, in order for it to be binding.2 Bowing to commercial opposition in the most recent version, the drafters have omitted all reference to commercial contracts. As the section stands, it applies only to consumer contracts.

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 …

Comments At The 1997 Aals Annual Meeting: Consumer Protection And The Uniform Commercial Code, James J. White

Other Publications

As Jean [Braucher]' said, I have served on several committees in connection with the revisions of Articles 2, 2A, and 5. I am now on a committee of uncertain obligation that is going to review the NCCUSL draft of Article 2 for the American Law Institute. I was the reporter-an awful task, if anybody ever asks you to do that, you should think about it once or twice-for Article 5. I think service as the reporter for Article 2 might kill Dick Speidel by the time he is done.

Ucc Proposals Concerning Consumer Transactions, James J. White

Other Publications

Professor Grant Gilmore once suggested that farmers would like a two section law. Section one would state "It shall be against the law to refuse to lend money to a farmer." Section two would state "It shall be against the law to collect a debt from a farmer." In a similar vein one might state the iron rule of consumer law, namely "No right that has ever been granted to a consumer, however ill considered and unjustified, may thereafter be withdrawn." Believing that some of the proposals for consumer protection that have been added in Revised Article 9 are not …

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.

International Payments And Five Foundations Of Wire-Transfer Law, Raj Bhala

Faculty Publications

No abstract provided.

Letters Of Credit: Highlights Of Revised Article 5, Edwin E. Smith, James J. White

Other Publications

1. Under what circumstances is it bad faith for an issuer to honor a letter of credit in the face of an applicant's offer of proof of fraud by the beneficiary? 2. What is the issuer's obligation where there is a waiver by the applicant that the issue chooses not to honor? 3. What are the rights of transferees of transferable letters of credit and assigness of proceeds?

Seller’S Damages From A Defaulting Buyer Of Realty: The Influence Of The Uniform Land Transactions Act On The Courts, Gerald Korngold

Articles & Chapters

No abstract provided.

The Intersection Of Articles 2 And 9, Steven L. Harris, James J. White

Other Publications

I. Standard Form Contracts II. Buyer in Ordinary Course; Prepaying Buyer III. Consignments IV. Seller's Right to Reclaim Delivered Goods