UCC Contract Formation Analysis

This essay analyzes two scenarios involving the sale of widgets, applying the Uniform Commercial Code (UCC) to determine whether contracts were formed. The first scenario involves a CEO expressing interest in widgets but not making a formal offer. The essay concludes that no contract was formed due to the lack of specific terms and ambiguity. The second scenario involves a written proposal from a salesman and acceptance by a company CFO. The essay concludes that a valid and enforceable contract was formed because the salesman's proposal constituted a valid offer, and the CFO's statement constituted acceptance, satisfying the requirements of UCC §2-206. The essay references relevant legal scholarship and the UCC itself to support its analysis. The provided solution demonstrates a clear understanding of UCC principles related to offer and acceptance in contract formation.

The “Widget” Scenario – Part I
In the event of contracts concerning a sale of goods (where goods are referred to as movable
items) and the sale is being conducted in a commercial setting, then the Uniform Commercial
Code (UCC) is applied straight away. The Section 2- 206, of UCC lays down certain conditions
regarding offer and acceptance in the formation of contract as:
a) The offer being made for the purpose of contract shall be unambiguously construed as
inviting acceptance by the offered.
b) Offer for purchasing goods should be construed as invitation for acceptance by reflecting
prompt promise due to the promptness of current situation regarding conforming or non-
conforming goods (Danzig, 1975).
c) The mode of acceptance is reasonable only when requested performance should have
begun and in the event of offeror not being notified about the acceptance then he may
treat the offer as lapsed whatsoever.
So, as per the UCC, a contract regarding sale of the goods can be created in any way that is
sufficient to show the agreement that unambiguously involve offer as well as acceptance. This
whole procedure is to be carried out by both the parties that fully recognizes the establishment of
a contract. In the present scenario, the CEO made a statement suggesting that the company which
he was working for was indeed requiring the widget and it would be really great for the company
to have a whole new set of the widgets for the accounting department. Having said that, in no
situation can it be concluded on the CEO’s part that he made an offer or gave any kind of order
to the salesman regarding the widgets. Rather, he was just expressing his interest and the need
for the widgets. There was no mention of offering any quantity, no discussion regarding price
terms or time of delivery. So, it can at least be said that the situation remained completely
ambiguous. It could at maximum be construed as an invitation of making an offer on the CEO’s
part. Therefore, we can conclude that the salesman had no contract at all.
The “Widget” Scenario – Part II
The Uniform Commercial Code (UCC) has been proven to be a comprehensive code in order to
address a number of aspects regarding commercial law. UCC is being considered now as one of
the most important developments in the American Law history. The National Conference of
Commissioners on Uniform State Laws along with American Law Institute drafted these
important statutes in order to make UCC a model code. After that, different state legislatures
enacted the UCC provisions. Gradually, the Code became a broad brush set of statutes that
govern the important business terms regarding contracts (Summers, 1968). As we know, the
whole business activities around the world are based on these elementary terms and no other law
could have defined these terms in a better way and therefore, the business law becomes
absolutely clear.
As per the Subsection (2), 2-206 of UCC that says Offer and Acceptance in Formation of
Contract. It says that the mode of acceptance is reasonable only when requested performance
should have begun and in the event of offeror not being notified about the acceptance then he
may treat the offer as lapsed whatsoever ("§ 2-206. Offer and Acceptance in Formation of

Contract.", n.d.). In this second case scenario, as per the UCC, an offer for the purchasing of a
certain goods regarding prompt or current shipment was made. It would be construed as inviting
the acceptance by a prompt promise for that prompt or current shipment regarding the
conforming and non-conforming goods.
So, here, as per the facts of the situation, a contract was clearly seemed to have formed because
of the fact that the sales man had proffered a written proposal that was apparently had written on
it the terms and conditions regarding the sale of the widgets. It surely should be construed as a
valid offer being made on the part of salesman. It is important to note that the CFO of the
company, being at his command of an authority for the company, told the salesman that they
should “get that going”. The CFO, therefore, was making it absolutely clear about his intentions
and expectations to the salesman that his firm should start making the widgets and supply them
to the company. Then, it was up to the salesman to either make the promise regarding the sale or
should actually supply the widget to the company. Therefore, we can conclude at the end that a
valid as well as enforceable contract has been formed between the two parties.

References
§ 2-206. Offer and Acceptance in Formation of Contract.. LII / Legal Information Institute.
Retrieved 6 October 2016, from https://www.law.cornell.edu/ucc/2/2-206
Danzig, R. (1975). A Comment on the jurisprudence of the Uniform Commercial Code. Stanford
Law Review, 621-635.
Summers, R. S. (1968). " Good Faith" in General Contract Law and the Sales Provisions of the
Uniform Commercial Code. Virginia Law Review, 195-267.