CAPSULE SUMMARY

This Capsule Summary is intended for review at the end of the semester. Reading it is not a substitute for mastering the material in the main outline. Numbers in brackets refer to the pages in the main outline where the topic is discussed. The order of topics is occasionally somewhat different from that in the main outline.

Chapter 1 INTRODUCTION

I. MEANING OF “CONTRACT”

A. Definition: A “contract” is an agreement that the law will enforce.

1. Written v. oral contracts: Although the word “contract” often refers to a written document, a writing is not always necessary to create a contract. An agreement may be binding on both parties even though it is oral. Some contracts, however, must be in writing under the Statute of Frauds.

II. SOURCES OF CONTRACT LAW

A. The UCC: Contract law is essentially common law, i.e. judge-made, not statutory. However, in every state but Louisiana, sales of goods are governed by a statute, Article 2 of the Uniform Commercial Code.

1. State enactments: A national drafting body, the National Conference of Commissioners of Uniform State Laws (NCCUSL) proposes revisions to various UCC Articles from time to time. Each state legislature then makes its own decision about whether and when to adopt the proposed revision.

a. 2003 Revision: The NCCUSL drafted a revision of Article 2 in 2003. That revision made some significant changes, especially in the area of electronic commerce. However, no state adopted it. Therefore, the NCCUSL withdrew the 2003 revision in 2011. Consequently, the version of Article 2 in force virtually everywhere in the U.S. as of this writing (early 2012) is the 1990 text.

b. Our text: Therefore, when this book refers to an Article 2 provision, the reference is to the 1990 version of Article 2, which is essentially unchanged since the original promulgation of Article 2 in 1957.

2. Common law: If the UCC is silent on a particular question, the common law of the state will control. See UCC § 1-103.