When Does the UCC Not Apply to a Sale of Goods?

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What Is the Uniform Commercial Code?

The Uniform Commercial Code (UCC) is very broad set of statutes that governs various business terms, especially with regards to contracts. For instance, it defines several terms, such as the terms "merchant", "goods", "services", and other business words. It also contains several outlines for contract formation, negotiations, and interactions.

For example, if there is a dispute over a term in the contract, the UCC will often "fill in the meaning" of the word depending on the context. Thus, the UCC is instrumental in resolving many types of contract disputes.

What Is the UCC Definition of "Goods"?

Generally speaking, the UCC and its guidelines applies to all contracts involving the sale of goods. Under the UCC, "goods" are defined as "all things that are moveable". This includes anything natural resources like lumber to man-made items such as computers and clothing. It excludes all land and real estate, and anything attached to the land. However, the term "goods" does include things that were once attached to land but can be removed from it, such as corn and other crops.

The term "goods" also excludes services. Therefore, contracts for services are not covered by the UCC. Intangible objects like stocks are also not considered goods.

When Does the UCC Not Apply to the Sale of Goods?

One major point regarding the UCC is that it only applies to merchants, which is defined as anyone with a special knowledge in a given commercial field. Therefore, a sale of goods between two private, non-merchant parties will not be subject to UCC requirements. A common example of this is where two ordinary, non-merchant citizens set up a contract for the sale of a car.

Also, there are some cases where the definition of "goods" can be "grey" or ambiguous. For instance, in a construction contract, it may happen that part of the job involves depositing rocks on a plot of land. In many cases, courts may have a difficult time determining whether this is actually a contract for labor (services), or for materials (goods). Depending on the exact facts, the UCC might not apply in such a case.

Do I Need a Lawyer for Help with Contracts for Sales of Goods?

Laws concerning contracts and the UCC can be quite complicated. You may need a lawyer for assistance with contract formation and editing. Your attorney can help you understand which laws apply to your situation and how you can avoid a violation. Also, in the event that you need to file suit, an attorney can represent you and inform you of how to proceed.

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Last Modified: 11-12-2013 03:06 PM PST

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