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Free «UCC and Bankruptcy» Essay Sample

Introduction

This essay is divided into five sections which address the cases raised under various circumstances with reference to the Uniform Commercial Code (UCC). The five sections addressed in this essay are; statute fraud, shipment and destination contracts, ethics, remedies of a buyer and the scope of security interest.

Statute of fraud; Quality Pork International versus Rupari Foods Services

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In UCC, there are statutes that are aimed at addressing various questions juts like the common law, which are concerned on whether there was meeting of the contract that was purely electronic; not only in writing requirement but also in the form of signatures. There are however some exceptions that are included by UCC to the writing requirements for the goods that are specifically produced and cannot be suitably be sold to others and those goods that have already began to be produced (Roger & Gaylord, 2009). The exception is also provided in the case of the goods that the buyer has already received or accepted. In the case provided, the Quality Pork international; which specializes in selling of the custom products of pork has already sent the products to Rupari Food Services and an agreement has been set to have the remaining amount of money settled after the products have already been received. This case falls under the exception of the already received or accepted goods.

Therefore, under the UCC, it is possible for Quality Pork International to file a suit against Rupari Food, based on the fact that whether or not the contract was signed and written, they are justified to payment for the remaining part of the agreement because the goods had already been received by Rupari Food Services. Therefore, based on the UCC provision for the exception to the writing requirements, the argument of Rupari is baseless and cannot be protected by this Commercial Code. Therefore, the breach is indeed valid and has justification for case proceeding against the Rupari Food Services. When the frauds statute is applied to the sale of the goods, there is no need to have the contract put in the form of writing. It is just some form of memo or note that must be in writing together with application of signature.

Shipment and destination contracts; Carlson versus Monaco coach Corp

The UCC definition of sale is limited to the scope of title passage from the seller to the buyer based on a certain agreed price. After the contract has been made, a present sale is accomplished. The code does not provide for the passage of the title under the sale contract before the contract has been identified unless if there is an otherwise explicit agreement that is acquired by the buyer through identifying the special property as this act may limit. Any reserving or retaining made by the seller to the goods that have been delivered to the buyer is only allowed if a security is reserved. Based on these provisions, the passage of the goods from the seller to the buyer takes any manner and condition based on the parties agreement which is of course explicit (Henry, 2004).

According to what is provided by the UCC, the transfer of the goods to the buyer is effected at the place and time that the performance has been completed in relation to delivering the goods physically. The defendant in this case is protected by the states laws which vary and which limit the use of the disclaimer rules of UCC implied warranty in the sales. Some of these appear in the UCC amendments together with other statutes that are separate. There a variation from one state to the other whether the application of these laws is based on the manufacturers and the retailers. In California, it may not be possible to disclaim the implied warranty in the sale of any goods that are not under the cover of express warranty unless in the case of complying with the statutory formula which is elaborate. Based on the variation in the place of the buyer, RVs manufacturer may be justified to defend the suit.

A question of ethics; West versus Roberts

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Wilson in this case was granted a forged check and at long last ends up acquiring no title based on the fact that he has no legal ownership and rights which he uses to illegally transfer the car to another party. After the corvette was entrusted to Wilson by West, he was granted the right through which he could be able to transfer all the rights. Based on the UCC 2 - 403, the existence of the voidable title is justified if the owner interest to the property is legal (American Law Institute, 2001). There is no title that is entrusted to the property which in this case happens to be stolen.

Therefore, the argument above can help us to justify that in Wilson case, there was no title that was acquired for Corvette which in this case can be termed as stolen despite the paid consideration and good faith that obviously may have been based on the final owner who this property was transferred to. Filling a case against Roberts by West becomes complicated based on the fact that in the first transaction between West and Wilson, Roberts was not the party at interest (not by any means involved).

In placing the judgment to this suit, it is important to consider the UCC 2 - 403 supporting principles based on which, we can apply the entrusted doctrine of the voidable title. In both doctrines, the risk of loss is placed on the seller who in this case happens to be West. In order to lay a verdict on the favor that the judgment should be made by the court rule, consider the difference that is found in the resale by a seller that is "nontitle" and a seller that is "voidable". In the latter case, the expressive provision by the UCC is based on the perception of the title belonging to the good faith purchaser and not the property's voidable title. Regardless of the number of times that the resale happens for value to the good faith buyer, the title of the purchaser does not indicates any improvement.

In the statute of the stolen property, there is no incorporation of the fraud or trick larceny even if the criminal law punishes it, in which there is delivery of the property possession by a person based on an agreement thereby resulting in the perpetrator being given the authority to which he can sell it under UCC. Consider, even if the dealer acted in a dishonest way, he did not steal the Corvette. Therefore, the plaintiff cannot be denied a statutory remedy by the civil theft claim based on the application of the economic rule to these facts. Therefore, Wilson cannot retain the ownership of the Corvette based on the fact that the statute of the stolen property cannot be applied in this case.

Remedies of a buyer. Waddell versus L.V.R.V

 
 
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The revocation of acceptance may be justified by the buyer based on which there is impairment of the value by non-conformity if there has been an acceptance. The occurrence of the revocation must be within a time frame that is reasonable (American Law Institute, 2001). Whether the timeframe in this case justifies the revocation of the acceptance will depend on the agreement that was entered between the two parties at the time of sale. In this case, the suit that is filled by Waddells is justified and validated based on the fact that the property sold to them did not conform to the expectation of the two parties.

There is however another side of the argument. This revocation; as provided in UCC should occur within a period of time that is reasonable after the discovery by the buyer and before the goods have changed in condition which does not result from the effect of the buyer. In this case, the buyer has already used the RV for a substantial period, therefore nullifying the basis for a suit. The seller is in this case justified to argue on the basis that the defects in the good resulting from the misuse by the buyer.

Whether this suit can be justified will also depend on the time period under which the revocation of acceptance notification was issued. And based on the fact that this remedy will depend on the failure of the adjustment attempts, the time that can be termed as reasonable should in most cases extend beyond the time in which the non-conformity was discovered and should extend beyond the time of rejection after the tender. Therefore, based on this provision, it is justified to conclude that the requirements are not in conformation with this case and the ruling by the court should be in favor of L.V.R.V.

The scope of security interest. Edward versus bank

The claim by Edward that the bank has the right to only half of his property after the loan default is justified and does indeed qualify him to file for a suit against the bank. If the property is in excess of the underlying obligation amount, the debtor who in this case happens to be Edward has the right to the excess amount. Therefore, the bank should in this case sell the property and entitle Edward the amount in excess of the value in which the collateral was initially valued at the time the agreement was written. Based on Bebchuk and Fried, (1996) insight, the same case applies to the circumstance whereby the proceeds fall short.

In such a case, the UCC gives the security interest holder an entitlement to the deficiency judgment whereby an additional legal proceeding can be instituted by the holder in the effort to have the full amount recovered. Under the article 9 of the UCC in which the security interest in personal property is protected elaborates the security interest in the scope of the debtor's property right in which the obligation of performance and payment is secured. Through the security agreement, there is creation of the security interest under which Edward is supposed to grant security interest in his property to represent loan collateral.

Through this security interest, the bank is granted the remedial action over the property in case a certain event occurs such as the loan default. Edward failed to submit to what governed the contract of loan repayment hence giving the bank to poses the property in order to ensure that the underlying obligation is satisfied. The bank therefore is entitled to selling Edward inventory in a public auction or privately; whichever option that is desirable and use the proceeds in satisfaction the obligation that is underlying.

In this case, the value of the proceeds has grown to a value that is twice the initial value at the time of the agreement, therefore calling for a legal proceeding against the holder in case of failure to comply with the UCC requirement. In case of a perfection absence, there may be some difficulty in the security interest holder enforcing his rights in regard to third-party such as the bankruptcy trustee together with other creditors with a security interest claim in the same collateral.

   

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