The Uniform Commercial Code Essay Sample
The United States of America has the Uniform Commercial Code to harmonize the laws of the fifty different states concerning commercial transactions between the states. The code has a recommendation of laws to be adopted by the states. The UCC was approved by the National Conference of Commissioners on Uniform state law, the American Bar association, the American law institute, and it was published in 1952. The states have the option to adopt and modify provisions or adopt it as written.
The growth of the national economy, the complex legal requirements and the different state laws made it difficult to do business with other states. The UCC makes the business laws consistent in all the American states thus making business activities more efficient. The standardized laws of the UCC make it easy for companies as they don’t have to include all the business details in the contractual agreements. The discrepancies in the state laws were clarified with UCC. It took seven years from 1945 to approve the draft of the code and Pennsylvania enacted the code first and made it a law on July 1, 1954. The UCC covers all the important aspects of business and information about breach of contract and conditions for rejection of goods are provided in detail.
It consists of ten articles dealing with all the aspects of businesses from contract agreement, breach of contract, methods of payment, liabilities of the parties involved, deposits, collections, investment securities, and other laws important to entrepreneurs and small business owners. Most states have adopted the UCC Code and some have slightly adapted it.
The advantage of the introduction of the Uniform Commercial Code is that people need not appoint lawyers or carry out complicated legal formalities. The uniformity of the law helps people to understand the law applicable to their transactions across all the states. The certainty of the laws encourages trade and commerce with other states which helps in developing contracts and to do business with the best partners. As there is no cumbersome legal procedures involved for interstate businesses costs can be reduced and the procedure to establish a company is easier. The UCC has its advantages as it provides a guideline to enforce contracts and also helps when there are disputed contracts and business discrepancies. The UCC has its limitations too. The law is not enacted exactly in the same way in every state. People don’t have to appoint lawyers or carry out legal formalities, but many lawyers claim that though it may seem to be an advantage it is causing more problems than solving them. Moreover, the scope of the UCC is limited to transactions of goods and not services. It regulates dealings which involve personal property but does not have any rule over land or any attached structures. The courts will consider the application of UCC only if the predominant purpose of the contract was the supply of goods and not services.