I85PREP
⌘ K
MEE study materials
MEE study resources

MEE: Contracts: Common Law and UCC Article 2

MEE · Work through your exam, one topic at a time.

All guide sections

Contracts: Common Law and UCC Article 2

What the MEE tests

Contracts tests formation, enforceability, performance, breach, and remedies. Article 2 governs transactions in goods and relaxes common-law rules on definiteness, acceptance, and modification.

Core rules

  • Formation: mutual assent requires a definite offer and acceptance; consideration is a bargained-for exchange. Promissory estoppel requires a promise, reasonable reliance, and injustice.
  • Statute of Frauds: writing required for marriage, year, land, executor, surety, and sale of goods over $500. UCC exceptions include specially manufactured goods, admission, and part payment or delivery.
  • UCC terms: output and requirements contracts are enforceable; a merchant's firm offer is irrevocable without consideration if in a signed writing. Acceptance may be by any reasonable means; additional terms depend on merchant status.
  • Performance and breach: common law requires substantial performance; UCC requires perfect tender, subject to cure and installment contracts. Anticipatory repudiation excuses the other party.
  • Remedies: expectation damages, consequential damages, reliance, specific performance, and liquidated damages. UCC buyers may cover and recover the difference; sellers may recover market damages.

Worked example

A farmer orally agrees to sell a custom-built harvesting machine to a cooperative for $80,000. The machine is specially manufactured for the cooperative and is not suitable for sale to others. The cooperative repudiates before delivery. The farmer cannot easily resell. Although the sale is over $500, the specially manufactured goods exception to the UCC Statute of Frauds applies if the seller has made a substantial beginning or commitments and the goods are not suitable for resale. The farmer may enforce the oral contract and seek damages or resale remedies.

Traps

Article 2 applies to goods, not services or real estate. A merchant's firm offer must be signed and can lapse. The Statute of Frauds requires a writing signed by the party to be charged, not both parties. Consequential damages must be foreseeable.