Sales and Leases | 4
I. Introduction to UCC Article 2
The law addressing contracts for the sale of movable goods appears in Article 2 of the Uniform Commercial Code (UCC), except in Louisiana.
Scope of Article 2
Article 2 applies to transactions in goods.
1. Transaction in Goods Defined
The term transaction in goods normally refers to a present or future sale of goods. A sale is the passing of title in goods from a seller to a buyer for a price.
2. Contract v. Agreement In the UCC, agreement refers to the parties’ bargain, gleaned from the language and context. Contract refers to the parties’ total legal obligation, including the bargain and governing contract law.
3. Goods Defined Goods include all items movable when identified to the contract.
4. Transactions Excluded from Article 2’s Scope
Several transactions are excluded from Article 2’s scope:
transactions operating only as secured transactions under UCC Article 9; leases; real estate transactions; bailments; and to the extent of any conflict with Article 2, transactions subject to laws regulating sales to specified classes of buyers, such as consumers or farmers. 5. Contracts for Services, Construction Contracts, and Hybrid Contracts Article 2 does not apply to contracts for services or construction contracts. The common law normally controls these transactions. But so-called hybrid transactions involve both services (or construction) and a sale of goods. Courts apply one of two tests to determine whether Article 2 or the common law controls hybrid transactions.
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