Formation of Sales and Lease Contracts
Formation of Sales and Lease Contracts
Business Law
Tenth Edition
Chapter 18
Formation of Sales and Lease Contracts
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Copyright © 2019, 2016, 2013 Pearson Education, Inc. All Rights Reserved.
Learning Objectives (1 of 2)
18.1 Describe the Uniform Commercial Code (UCC).
18.2 Define sales contracts governed by Article 2 of the UCC.
18.3 Define lease contracts governed by Article 2A of the UCC.
18.4 Describe the formation of sales and lease contracts and define the firm offer rule.
18.5 Describe acceptance and define the UCC’s additional terms rule and written confirmation rule.
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Learning Objectives (2 of 2)
18.6 Describe the UCC Statute of Frauds for sales and lease contracts.
18.7 Describe how Revised Article 2 (Sales) and Article 2A (Leases) permit electronic contracting.
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Introduction
Article 2 (sales) and Article 2A (leases) of the UCC govern personal property sales and leases
Intended to provide clear, easy-to-apply rules that place the risk of loss of the goods on the party most able either to bear the risk or insure against it
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Uniform Commercial Code (UCC)
Model act that includes comprehensive laws that cover most aspects of commercial transactions
All the states have enacted all or part of the UCC as statutes
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Article 2 (Sales) (1 of 3)
Governs the sale of goods
Sale: Passing of title from a seller to a buyer for a price
Goods: Tangible things that are movable at the time of their identification to a contract
Money and intangible items are not tangible goods
Real estate is not a tangible good
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Article 2 (Sales) (2 of 3)
Goods versus services
Contracts for the provision of services are not covered by Article 2
Mixed sale: Involves the provision of a service and a good in the same transaction
Article 2 applies to mixed sales only if the goods are predominantly part of the transaction
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Exhibit 18.1: Sales Transaction
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Case 18.1: Good or Service5
