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Grocery, Inc; Contract Law Portion

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Grocery, Inc.

**Contract Law Portion**

There are two bodies of law that govern contracts; Article 2 of the Uniform Commercial Code and the common law of contracts. “The Uniform Commercial Code, or UCC, is statutory law in every state. The common law of contracts is court-made law that, like all court-made law, is in a constant state of evolution.” (Mallor, 2007) The UCC was created by the American Law Institute and the National Conference of Commissioners on Uniform State Laws to establish a uniform set of rules to govern commercial transactions, help solve the common problems that occur during these transactions, and promote higher standards for fair dealing in the marketplace. A body of rules for the US as a whole is important because most commercial business is conducted across state lines. Louisiana is the only state that has not adopted the code in full.

Grocery, Inc. has stores throughout the US but has written contracts with a variety of vendors, including international corporations. Article 2 does apply to Grocery, Inc’s contracts that are written with venders within the US, but does not apply to contracts written with international corporations. “Article 2 is the "Bible" for contracts/purchase orders for the sale/purchase of goods in the United States. It applies to transactions in "goods," as defined in UCC 2-103, and thus impacts all buying and selling professionals within the United States” (Rumbaugh, 2005) When dealing with international transactions the Contacts for the International Sale of Goods (CISG) will apply.

The definition of “goods” in Article 2 is that they are tangible, movable, personal property. “So, contracts for the sale of such items as motor vehicles, books, appliances, and clothing are covered by Article 2.” (Mallor, 2007) Article 2 applies to contracts for the sale of goods, but it does not apply to contracts for the sale of real estate, services, or intangibles such as stocks and bonds.



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