Also known as: Art. 2 · UCC Article 2 · UCC sales
Written by attorneys · grounded in primary & secondary sources — see below
A statutory framework within the Uniform Commercial Code that governs contracts for the sale of goods. It supplies formation rules, warranty obligations, and remedies that differ from general common-law contract principles when the transaction involves movable tangible items.
Apex Dynamics sold specialized mining equipment to Alpine Mining under a contract that reserved title until full payment. Alpine took delivery and began using the equipment but made no further payments. When Alpine entered receivership, Apex asserted its retained interest to recover the equipment. The court applied Article 2 rules to determine that the reservation of title created an enforceable security interest arising under the sales article.
Avalon Pharmaceuticals purchased laboratory chemicals from a regular supplier in the ordinary course of its business without knowledge of any prior security claim. When a secured creditor later asserted rights in the chemicals, Avalon invoked its status as a buyer in ordinary course. Article 2 supplied the definitional framework that shielded Avalon from the prior interest.
Select any source to read its text and confirm it supports the definition.
Alice Atkins contracted with Astra Aerospace for repeated deliveries of specialized fasteners. Over several years Astra accepted orders specifying a particular grade of alloy even though the written contract contained no such term. When a later dispute arose, Alice offered evidence of the parties' consistent prior dealings. The court used Article 2 to admit the course-of-performance evidence to interpret the contract.
Austin Abbott agreed to supply custom parts to Amber Alonzo at a fixed price. Rising material costs prompted a good-faith price adjustment that Amber accepted in writing. When Amber later refused the higher price, Austin sued. Article 2 rendered the modification binding without fresh consideration because it was sought in good faith.
Amelia Amari contracted to purchase specialized film equipment from Twentieth Century-Fox but the supplier canceled. It offered her comparable equipment in another transaction that she declined. Amelia sued for the full contract price. Article 2 principles required her to mitigate damages, reducing recovery by the amount she could have saved in the substitute purchase.
Arthur Abrams contracted with Aluminum Company of America to supply aluminum at a fixed price tied to a published index. A sudden and unforeseen escalation in production costs rendered performance commercially impracticable. Arthur sought excuse under Article 2. The court examined whether the cost increase was within the parties' contemplation at formation.
Article 2 applies to the goods portion of a hybrid transaction. If goods predominate, the entire contract falls under Article 2 while non-goods obligations remain subject to other law. If services predominate, Article 2 still governs disputes concerning the quality or conformity of the goods themselves.
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No. When a transaction functions only as a security device rather than a genuine sale of goods, Article 2 does not apply. Courts examine the substance of the arrangement, including whether the seller retains ownership burdens and whether payment terms mirror a loan.
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A buyer who revokes acceptance may assert a security interest in the goods to the extent of the price paid and incidental expenses. The buyer may then resell the goods after proper notice and apply the proceeds to its claim.
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…Murray, Behaviorism Under the Uniform Commercial Code, 51 Ore.L.Rev. 269, 272 (1972); D. Murray, Under the Spreading Analogy of Article 2 of the Uniform Commercial Code, 39 Fordham L.Rev. 447 (1971). [^maj-35]: The Court is aware of the practical incentive to negotiation which lies in the delay, expense and uncertainty of…