The Uniform Commercial Code (UCC) was created to achieve consistent sales laws across the United States. The UCC is a joint project of the American Law Institute (ALI) and National Conference of Commissioners on Uniform State Laws (NCCUSL), and has been adopted in whole or in part by most states.
The NCCUSL and ALI have established a permanent editorial board that publishes papers and official comments on the UCC. While these papers and comments do not have the force of law, courts often rely on them as persuasive authority when interpreting the UCC. Courts also typically interpret the UCC consistent with the decisions of other states.
Goals of the UCC
In addition to creating uniformity among the states’ sales laws, the UCC was created to:
- Provide missing provisions to sales contracts;
- Streamline routine transactions, such as the processing of notes, checks, and other commercial paper;
- Modernize contract law;
- Allow for exceptions from the common law in contracts between merchants; and
- Discourage the use of legal formalities in sales contracts.
The UCC is comprised of the following nine articles:
1. General – Contains definitions and rules of interpretation.
2. Sales and Leases – Addresses the sale of goods.
2A. Leases – Addresses the lease of goods.
3. Negotiable Instruments – Addresses commercial paper.
4. Bank Deposits and Collections – Addresses banks, banking, and the check collection process.
4A. Funds Transfers – Addresses the transfer of money between banks.
5. Letters of Credit – Addresses transactions involving letters of credit.
6. Bulk Transfers and Bulk Sales – Addresses auctions and the liquidation of assets.
7. Warehouse Receipts, Bills of Lading and Other Documents of Title – Addresses the storage and bailment of goods.
8. Investment Securities – Addresses securities and financial assets.
9. Secured Transactions – Addresses transactions secured by security interests.
Texas Contract Litigation Attorneys
Ajamie LLP’s contracts practice assists corporations and individuals in reviewing, negotiating, and creating effective contracts. The firm litigates contract disputes involving both domestic and international issues. Our experienced Texas attorneys have resolved controversies arising under the UCC, the United Nations Convention on Contracts for the International Sale of Goods, and other laws governing domestic and international commerce. Our attorneys also provide cross-border representation in a variety of business disputes. Please contact one of our experienced contract litigation attorneys for a consultation.