Contract Law, Transactions in Business, and the Uniform Commercial Code (UCC)
The goal of this assignment is to understand contract law, transactions in business, and the application of the Uniform Commercial Code (UCC).
Scenario
Dan and Leo agree to buy and sell “groceries and sundries” from Public Growers, Inc. in their stores. The five-year contract does not define groceries and sundries, but the parties agree the number of products purchased should be consistent every week. COVID hits and Public Growers, Inc., has a hard time meeting the demand of its sellers. Brian, the produce manager for Public Growers, assures Dan and Leo they will always have enough fruit and vegetables for their stores. Dan and Leo file suit for breach of contract.
Instructions
Given the scenario above:
- Determine whether a contract is formed and if the situation is governed by common law contracts or the Uniform Commercial Code. Support your determination with evidence
- Determine whether parol evidence is admissible to explain the terms of the contract and whether any exceptions pursuant to the Uniform Commercial Code apply.
- Determine whether Dan and Leo can successfully sue for breach of contract when they are forced to close two stores. Support your findings and provide an understanding of the law.
- Research three potential contract defenses for Public Growers, Inc., and explain how they could be utilized to avoid liability.
Food, Covid, And The Uniform Commercial Code
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Food, Covid, And The Uniform Commercial Code
1 Determine whether a contract is formed and if common law contracts or the Uniform Commercial Code governs the situation. Support your determination with evidence.
In the United States, contract law is primarily determined by the common law and the Uniform Commercial Code. These bodies of law are referred to as “sources of law.” Contracts involving a merchant and the purchase or sale of goods are governed by Article 2 of the Uniform Commercial Code (UCC). The UCC can be broken down into two categories of contract regulations (Nisar Law Group, 2014). The first group of rules applies to everyone, whereas the second group applies specifically to businesses. Contracts for services and other types of agreements that the UCC does not explicitly address are regulated by common law.
Understanding the components of a common-law contract formation is essential because the standards for creation between merchants under the UCC are not as strict as the common-law requirements. If a contract is not formed under the provisions of common-law contract formation, then the contract may not be valid or may be subject to revocation. Offer, acceptance, and consideration are the constituent parts of establishing an agreement in the common law. Accordingly, the combination of the offer and the acceptance results in mutual consent. A contract must also have a legal purpose to be enforceable, and all parties must be of legal age to make legally binding agreements.
In common-law contracts, the acceptance must mirror the offer to constitute legitimate acceptance as indicated in the regulations. Following such guidelines shows that the accepted offer is the same as the initial offer. If the acceptance is not identical to the proposal in every respect, it will not be considered an acceptance. Therefore, it will not be regarded as a valid component in forming a contract. When indicating that they are interested in the deal, the offeree can say something such as, “I agree to buy your scooter for four hundred dollars.” If the given offer is met with a counteroffer, it would not be considered acceptable because it differs from the original deal (Nisar Law Group, 2014). Therefore, if the person being offered said, “I agree to buy your scooter for three hundred dollars,” that would not be considered an acceptance of the offer. Making a counteroffer is the same as turning down the presented deal.
If the offeree rejects the offer directly (for example, by declining to accept) or indirectly (via a counteroffer), the offeror can walk away from the unsuccessful negotiation. In this particular illustration, he is no longer required to sell his scooter, even if the offeree changes his mind and agrees to pay an additional four hundred dollars. In a similar situation, if the offeror revokes an offer before the offeree accepts it, then the power of acceptance is lost due to the revocation of the offer (Nisar Law Group, 2014). It would no longer be necessary for the offeror to sell the thing that was initially offered. If the person who made the offer wanted to restrict the time that the offer could be accepted, he might do so by setting a time limit. If the offer is not taken during that time, the offeror is not bound to honor any acceptance made after the offer has expired.
The contract’s subject matter must serve a legitimate and lawful purpose in determining its validity. A contract for a criminal subject matter would be formed if a person who distributes illegal narcotics paid a pilot to transport his illegal cargo to a particular location, as this would constitute the distribution of illicit goods. If the drug dealer does not honor his agreement to pay or the pilot does not transport the cargo, neither of the aggrieved parties can find remedy in courts, even if all of the components of the contract are present and perfectly formed. In addition, for the conditions of an agreement to be enforceable against its parties, those parties must h...