Sales and Leases | 35
Movable Things A good, under UCC Article 2, is a movable thing. The purpose of defining goods in terms of movable things is to clarify that, generally, goods are personal property, as opposed to real property. Thus, for instance, diamonds extracted from the ground are goods; they are things, they are movable, and they are no longer part of any real property. Indeed, electricity is a good. Electricity is movable, in that it is transmitted and delivered through power lines. On the other hand, an in-ground swimming pool is not a good, because it is immovable. One court, however, found that a lottery ticket is not a good. Though the ticket itself is a movable thing, what the ticket embodies is a chance to win money. A mere chance is intangible and, at the time of purchase, immovable. [ See 2 Anderson U.C.C. §§ 2-105:31, 2-105:32, 2-105:36 (3d. ed.), Westlaw (database updated Dec. 2020).] Things Movable at the Time of Their Identification to the Contract To be a good under Article 2, not only must a thing be movable, but it must be movable at a specific time. That time is when the thing is identified to the contract. Thus, if a thing is movable at the time of its identification to the contract, then UCC Article 2 may apply, even if the thing later becomes immovable (for instance, because it becomes incorporated into real property, as when movable materials are incorporated into a building). Generally, absent contrary agreement, if the goods are identified and preexist the contract, then they are identified to the contract when the contract is made. Different rules apply if the goods do not yet exist when the contract is made, or in the case of crops. [ See 2 Anderson U.C.C. §§ 2-105:36, 2-105:38 (3d. ed.), Westlaw (database updated Dec. 2020); U.C.C. §§ 2-105(1), 2-501(1)(a) (1951); Identifying Goods to the Contract, infra .] Exception for Things to Be Severed from Realty There is one notable exception to the requirement that, for a thing to be a good, it must be movable when it is identified to the contract. Namely, a thing to be severed from realty can be a good, even if it is not movable at the time of its identification to the contract. This exception generally covers (1) minerals, including oil and gas, to be removed from real estate; (2) structures to be removed from realty; and (3) crops and other things attached to real property, including timber to be cut. [ See U.C.C. §§ 2- 105(1), 2-107(1)-(2) (1951).] 1) Minerals, Including Oil and Gas, and Structures to Be Removed from Realty A contract for the sale of minerals and similar substances, including oil and gas, to be removed from realty is a contract for the sale of goods (and, hence, a transaction
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