Contract Law

The Uniform Commercial Code (UCC) is the main body of law that governs transactions involving goods. It was developed by the National Conference of Commissioners on Uniform State Laws and the American Law Institute, a nonprofit legal research organization. Since its completion in 1952 it has been adopted by all 50 states (Louisiana, however, did not adopt all of the code). The purpose of the code is to facilitate commerce by simplifying and clarifying the law regarding commercial transactions and to create a uniform set of rules nationwide. The UCC is largely based on common law, which means that it usually adheres to legal guidelines established in court cases. However, in many cases the UCC is forced to establish codes outside of traditional legal precedent in order to conform to the rapid pace of modern business practices.

In the United States, the UCC governs the sale of tangible, movable goods, property leases such as business equipment, and financial transactions such as bank deposits and letters of credit. The sale of services and real property are not covered by the UCC. International transactions are governed by the United Nations International Sale of Goods Convention, adopted by the United States in 1988, provided the foreign country involved is party to that agreement. Various state and federal statutes regulate contracts for services, consumer credit, the sale of land, and other specialized areas such as employment. Where no relevant statute exists, contracts are evaluated using common law principles. The Restatement of Contracts, created and published by the American Law Institute, summarizes and "restates" common law principles of contract. Although it does not have the force of law, it is heavily relied upon by legal professionals, including judges, who often quote it in written opinions.