Uniform Commercial Code and Farmers


Essay, 2017
4 Pages

Excerpt

Introduction

Most of the relationship between humans is protected by the law. Among these laws there are those that regulate the relationship between traders or merchants. Because of the diversity of merchant activities, different laws applied to every form of transactions and parties. However, the Uniform Commercial Code (UCC) came in to bring all the different laws into one code. As such, the UCC defined in its own way, who qualifies to be a merchant among other terms that were in contention. Regarding the case at hand, it is related to farming and farming in general, has its own challenges when it comes to enforcing agreements between different parties. Article 2 of the UCC for instance qualifies who a merchant is and also disqualifies who may not be a merchant. It further provides for cases whereby someone may be deemed to be a merchant.

In order for the Uniform Commercial Code to apply to farmers, there is an important thing that must be proved. That is that the parties have met the threshold for being considered merchants. As it can be seen in the Phillip Wendling case, they both were merchants as they fell within the definition in the UCC. Having been a stockman and farmer in the Harvey County, he can be held to have knowledge peculiar to farming. This implies that he was well versed with the trade practices in farming and stocking. Mr. Puls on the other side is said to be an active cattle buyer in the area and the fact that they met in the right forum meant they both were accustomed to the farming activities.

A good case law whereby the defendant claimed he was not a merchant as per the Uniform Commercial Code is in the case of a 1977 case. Referring the case of Nelson v. Union Equity Cooperative Exchange 548 S.W.2d 352 (Tex. 1977) presents a scenario whereby a seller was found liable after failing to deliver wheat at a future date as agreed. He claimed he could not be bound by the agreement as he was not a merchant in the first place and also claimed that he had not signed the agreement. The Court disagreed with him and stated that he had a reasonable timeframe to reject the agreement of which he did not hence liability. Also, in this case, it was held that he was a merchant as he had met some of the principles developed by Courts to determine how long someone should have been in the trade to be said to have been a longtime merchant a principle that was in agreement with Dolan (1977) when he posited that courts ought not look at strict wording of the Codes when determining liability.

Therefore, the two qualified to be merchants hence Article 2-104 is applicable to both parties. Further, even if Puls were not a direct merchant, the fact that he represented Mr. Watson would still make him and the third respondent liable or bound by any commercial agreement they make. Further, their actions satisfy the provisions of sections 1-104 of the Uniform Commercial Code as they all had some kind of specialty in the cattle business.

Another requirement for a valid contract or agreement is that of both parties agreeing to the terms or just to the subject in question as reiterated by Gillette and Walt, (2016). This is also provided under Article 2 on “Formation in General.” The case meets the formation requirement by virtue of Mr. Wendling agreeing to sell a certain number of cattle heads to the defendants after negotiations. It can be seen that Wendling offered to sell and Puls and Watson accepted when they went on to pay partly as they waited for the full completion of the contract.

Also, contracts or rather, agreements may be made for a fulfillment of an instant transaction or a future delivery or transaction as stated in Section 2-106(1). Under 2-309(1) of the Uniform Commercial Code, agreements without time limits for fulfillment are provided for. The preceding type of agreements can only be considered revoked after expiry of reasonable time. However, where there is a time specification as in this case, a revocation ought to have been made within the time frame in the agreement according to Section 2-201(2). The defendants refused to revoke the agreement within the limits set by the oral agreement. Therefore the two defendants would be held to be in breach of the contract as they failed to revoke the contract before the timelines expired.

In the case of Currituck Grain, Inc. v. Powell 38 N.C. App. 7, 246 S.E.2d 843 (1978), there was a related scenario. After holding that both parties were merchants under the provisions of Article 2-201(2), it was established that both were bound by the contract hence could enforce from their side if one party failed to play his part according to the contractual agreement.

In conclusion, it would be the plaintiff Mr. Wendling who should get remedy for breach of contract by Puls and Watson. According to what transpired, it can be conclusively held that there was an agreement between two merchants. As such, once the agreement was made, it was irrelevant that the defendant had not signed any release document that the plaintiff sought signatories. Further, there was a loss on the plaintiff’s side and it would be prudent to restore him to the position he would have been in had the agreement been performed to completion. The parties qualify under the Code as merchants, they agreed to a commercial transaction and ultimately were expected to meet their obligations failure to which they were to accept responsibility hence liability for any form of damages as dictated by the Uniform Commercial Code provisions.

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Excerpt out of 4 pages

Details

Title
Uniform Commercial Code and Farmers
Author
Year
2017
Pages
4
Catalog Number
V414666
ISBN (eBook)
9783668652163
File size
397 KB
Language
English
Tags
uniform, commercial, code, farmers
Quote paper
Benaiah Mayabi (Author), 2017, Uniform Commercial Code and Farmers, Munich, GRIN Verlag, https://www.grin.com/document/414666

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