Friday, July 26, 2019
Contracts and Leases in Common Law and UCC Essay
Contracts and Leases in Common Law and UCC - Essay Example Normally, a contract is enforced and governed by the laws of the country where it was made. In the United States of America, a contract is governed by two types of state laws, that is, the common law and the Uniform Commercial Code (UCC) (Bagley and Dauchy, 2012). Common law is a law which governs contracts for services and contracts that are not governed by the Uniform Commercial Code. Most contracts such as employment agreements, general business agreements and leases are controlled by common law. Common law contracts can either be bilateral or unilateral. However, the contracts are valid only if the three elements of common law contract formation are met. The elements of formation are offer, acceptance and consideration (Bagley and Dauchy, 2012). The uniform commercial code (UCC) governs the contracts between merchants and the sale of goods. The law was written by the National Conference of Commissioners on Uniform State Laws (NCCUSL) and the American Law Institute (ALI). It was p ublished in 1952 to harmonize the law of sales and other commercial transactions in the United States. Although it has not been fully enacted, some provisions of the code have been adopted by all the fifty states of the US (Fullerton, 2011). Previously, the code was divided into 9 articles; however, after a number of reviews and revisions, the code is now divided into eleven articles with each giving provisions that relate to a particular area of commercial law. Article 1, gives the definitions of terms used in commercial law and the general principles that apply to the UCC. Article 2 covers all contracts pertaining to the sale of goods. Article 2A covers all transactions pertaining to leases of goods. Article 3 covers negotiable instruments such as checks and promissory notes.