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NC PT Juris study materials
NC PT Juris study resources

NC PT Juris: Contracts and Business Organizations

NC PT Juris · Work through your exam, one topic at a time.

All guide sections

Contracts and Business Organizations

What this domain tests

Expect two strands: general contract formation and enforcement under North Carolina common law and G.S. Chapter 25 (UCC Article 2), and entity formation and governance under Chapters 55 (business corporations), 57D (limited liability companies), and 59 (partnerships).

Contract fundamentals

  • Formation requires offer, acceptance, consideration, capacity, and legality. Acceptance must be communicated in the manner invited.
  • The statute of frauds (G.S. 22-1 and 22-2) requires a writing for land transfers, suretyship promises, and contracts not performable within one year. UCC 2-201 requires a writing for goods of $500 or more, with merchant exceptions.
  • Expectation damages are the default; mitigation and foreseeability limit recovery.
  • The Unfair and Deceptive Trade Practices Act, G.S. 75-1.1, reaches conduct in or affecting commerce and carries a four-year limitations period and possible treble damages.

Entity basics

  • A corporation forms by filing articles of incorporation with the Secretary of State and must maintain a registered agent and file annual reports. Shareholders, directors, and officers hold distinct roles.
  • An LLC forms by filing articles of organization; the operating agreement governs management, voting, and distributions. Members are generally shielded from personal liability, subject to veil-piercing for misuse of the form.
  • Partnerships may be general, limited, or registered limited liability partnerships; agency authority differs sharply between them.
  • Complex commercial disputes may be designated to the North Carolina Business Court under G.S. 7A-45.4.

Worked example

A member of a two-person LLC signs a supply contract personally without noting her capacity. The supplier sues her individually. The operating agreement's liability shield does not erase a signature that appears in an individual capacity; the analysis turns on the contract language and whether the counterparty believed it was dealing with the entity.

Traps that cost marks

  • Applying UCC Article 2 to a services contract.
  • Assuming filing articles alone creates an enforceable operating agreement.
  • Forgetting the statute of frauds on one-year contracts.