Contracts: UCC Article 2 — Sale of Goods

What is the definition of 'goods' under UCC Article 2?

Under UCC Article 2, 'goods' are defined as all things that are movable at the time of identification to the contract for sale.

What test do courts use to determine if UCC Article 2 applies to a hybrid contract involving both goods and services?

Courts use the 'Predominant Purpose Test' to determine if the primary thrust of the contract is for the sale of goods or the provision of services.

How does UCC Article 2 define a 'merchant'?

A merchant is a person who deals in goods of the kind or otherwise by their occupation holds themselves out as having knowledge or skill peculiar to the practices or goods involved in the transaction.

Under UCC 2-205, what are the requirements for a merchant's firm offer to be irrevocable without consideration?

A merchant's firm offer is irrevocable without consideration if it is an offer to buy or sell goods, made by a merchant, in a signed writing, that explicitly gives assurance it will be held open (for a maximum of 3 months).

Under UCC Article 2, will a contract fail for indefiniteness if the parties leave the price term open?

No, under the UCC, a contract will not fail for indefiniteness if the parties intended to make a contract; the court will apply a gap-filler, setting a 'reasonable price at the time for delivery.'

Under UCC 2-207(1), does an acceptance containing additional or different terms operate as a valid acceptance or a counteroffer?

Under UCC 2-207(1), a definite and seasonable expression of acceptance operates as a valid acceptance, not a counteroffer, even if it states additional or different terms, unless acceptance is expressly made conditional on assent to those terms.

Under UCC 2-207(2), when both parties are merchants, do additional terms in the acceptance automatically become part of the contract?

Yes, additional terms become part of the contract between merchants unless: (1) the offer expressly limits acceptance to its terms, (2) they materially alter the contract, or (3) notification of objection is given within a reasonable time.

How is an express warranty created under UCC Article 2?

An express warranty is created by any affirmation of fact or promise, any description of the goods, or any sample or model that becomes part of the basis of the bargain.

What is the Implied Warranty of Merchantability, and who does it apply to?

The Implied Warranty of Merchantability is a guarantee that goods are fit for their ordinary purposes, and it applies automatically only when the seller is a merchant with respect to goods of that kind.

What elements are required to establish an Implied Warranty of Fitness for a Particular Purpose?

This warranty arises when the seller knows the buyer's particular purpose for the goods, the seller knows the buyer is relying on the seller's skill or judgment to select suitable goods, and the buyer actually relies on it.