The Formation of Sales Contracts

1
The Formation of Sales Contracts

• Chapter 10

2
Article 2-Sales of Goods

• Sale "the passing of title from the seller to
  the buyer for a price" UCC 2-106(1). The price
  may be payable in money, goods, services, or
  land.
• Goods tangible personal property
• If a transaction involves both goods and
  services, a court determines which aspect is
  dominant.

3
Merchant

• Merchant
• (1) deals in goods of the kind involved
• (2) by occupation, holds themselves out as having
  knowledge and skill peculiar to the practices or
  goods involved in the transaction
• (3) employ a merchant as a broker, agent, or
  other intermediary. UCC 2-104

4
UCC Changes from Common Law

• 1, Open Terms ( Price, Payment, Delivery) UCC
  2-204
• 2. Merchant's Firm Offer UCC 2-205
• 3. Acceptance
• a. promise to ship or prompt shipment
  2-206(1)(b) accommodation
• b. Additional Terms 2-207
• 4. Modification needs no consideration, must be
  in good faith

5
International Sale Goods

• Contracts for the international sale of goods are
  governed by the 1980 United Nations Convention on
  Contracts for the International Sale of Goods
  (CISG).
• Applies when the parties to an international
  sales contract do not specify in writing the
  precise terms of their contract. Does not apply
  to consumer sales.

6
Comparison of CISG and UCC Provisions

• Mirror Image Rule applies in CISG(Art 19)
• An offer is irrevocable if the offeror states
  that it is offeree reasonably relies on it as
  irrevocable writing and consideration not
  needed. Art. 16(2).
• CISG No Statute of Frauds. (Art.11)
• CISG - Must state price

7
Special Provisions in International Contracts

• Choice of Language
• Choice of Forum ( Place of litigation)
• Choice of Law (Sellers place of business if
  not specified.)
• Force Majeure ("Impossible or Irresistible
  Force")
• Stipulates that acts of God and other
  eventualities (government orders
  regulations, embargoes, shortages of materials)
  may excuse a party from liability for
  nonperformance.