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1.3 2003 Revisions to UCC Articles 2 and 2A, Now Withdrawn

In 2003, after a lengthy and controversial process, the Uniform Law Commission (formerly the National Conference of Commissioners on Uniform State Laws or NCCUSL) and the American Law Institute (ALI) approved amendments to UCC Articles 2 and 2A for consideration by the states.51 No state legislature ever enacted the revisions, and the Uniform Law Commission withdrew them in 2011.52

The revised version of Article 2 would have made a number of significant changes to warranty law. It would have:

  • ● Excluded “information,” an undefined term, from the Article 2 definition of goods,53 leaving it up to the courts to determine whether a product that included a computer chip was governed by Article 2
  • ● Provided for electronic signatures, documents, and notices, setting rules with even fewer consumer protections than provided by the Uniform Electronic Transactions Act.54
  • ● Raised the threshold for the statute of frauds to $5000.55
  • ● Significantly revised the law regarding the “battle of the forms.”56
  • ● Encouraged sellers’ imposition of post-acceptance terms by using a broad standard of whether the parties agreed to such changes, and by treating clicking on an internet button as assent to terms.57
  • ● Treated a remote seller’s advertisements, repair promises, and certain descriptions of or affirmations of fact about the goods as enforceable obligations running to the remote buyer, but not as warranties.58
  • ● Treated “remedial promises”—promises to repair or replace goods, or to refund the purchase price—separately from warranties, with the statute of limitations running from the date of breach of the promise rather than from the date of delivery of the goods.59
  • ● Changed the language that must be used to disclaim the implied warranty of merchantability.60
  • ● Mandated special language to disclaim the implied warranty of fitness for a particular purpose.61
  • ● Provided that failure to give notice of breach would bar the buyer from a remedy only to the extent that the seller would be prejudiced thereby.62
  • ● Required not only buyers who reject goods but also buyers who revoke acceptance in non-consumer contracts to specify the defects on which they were relying.63
  • ● Allowed a good faith seller an opportunity to cure by tendering conforming goods not only after rejection but also, in non-consumer contracts, after revocation of acceptance.64
  • ● Allowed post-revocation or post-rejection use of the product if reasonable under the circumstances, but with a requirement that the buyer could be obligated to pay the seller for the value of such use in appropriate cases.65
  • ● Prohibited contractual reduction of the statute of limitations in consumer transactions.66
  • ● Adopted a discovery rule even for warranties that do not extend to future performance, by allowing suit up to four years after accrual of the cause of action or one year after the defect was or should have been discovered, whichever was longer, but no later than five years after accrual of the cause of action.67

The changes in revised Article 2A were similar to those in revised Article 2.

Footnotes

  • 51 {39} Drafts of the revisions are available on the Uniform Law Commission’s website, www.uniformlaws.org. A summary of revised Articles 2 and 2A may be found in William H. Henning & Fred H. Miller, The State of the Uniform Commercial Code—2003, 51 U.C.C. Bull. No. 3 (Dec. 2003), 51 U.C.C. Bull. No. 4 (Jan. 2004).

  • 52 {40} See Am. Law Inst., 88th Annual Meeting, Updates (May 16–18, 2011), http://2011am.ali.org/updates.cfm.

  • 53 {41} Revised U.C.C. § 2-103(1)(k). See § 1.5.1, infra.

  • 54 {42} See U.C.C. §§ 2-103(1)(b), (f), (g), (h), (m), (p) (definitions), 2-203 (contract formation), 2-211 (legal recognition of electronic contracts, records, and signatures), 2-212 (attribution of electronic signatures), 2-213 (receipt of electronic communications).

    Consumer advocates and others have expressed significant concerns about many of these provisions. See materials posted by Americans for Fair Electronic Commerce Transactions at www.affect.ucita.com.

  • 55 {43} Revised U.C.C. § 2-201.

  • 56 {44} Revised U.C.C. § 2-207.

  • 57 {45} Revised U.C.C. §§ 2-207, 2-204.

  • 58 {46} Revised U.C.C. §§ 2-313A, 2-313B. See also revised U.C.C. 2-103(1)(n) (definition of “remedial promise”). See generally § 3.1, infra.

  • 59 {47} Revised U.C.C. §§ 2-103(h), 2-725(2)(c).

  • 60 {48} See revised U.C.C. § 2-103(m). See also U.C.C. § 1-203(a)(31).

  • 61 {49} Revised U.C.C. § 2-316(2), (3).

  • 62 {50} Revised U.C.C. § 2-607(3)(a).

  • 63 {51} Revised U.C.C. § 2-605.

  • 64 {52} Revised U.C.C. § 2-508.

  • 65 {53} Revised U.C.C. § 2-608(4).

  • 66 {54} Revised U.C.C. § 2-725(1).

  • 67 {55} Revised U.C.C. § 2-715.