Business Transaction & Business Sales Law Firm Los Angeles

In California, sales of goods transactions are governed by Division 2 of the Commercial Code which, with some variations, conforms with Article 2 of the Uniform Commercial Code. A contract for the sale of goods may be made in any manner sufficient to show agreement between the parties. The conduct of the parties may be sufficient to recognize the formation of a contract. If there are terms that are left open, Division 2 of the Commercial Code provides default terms that are basically “gap-filling” terms as to the rights and obligations of the buyer and seller. In general, a contract for the sale of goods of $500 or more must be in writing to be enforceable. However, the only term of the contract that needs to be in writing is the quantity of goods. No other written terms are necessary for the formation of a valid contract. For example, Division 2 of the Commercial Code has provisions fixing the price of the goods when the contract does not contain a price term, allowing the parties to supply missing terms in the course of their performance, or terms relating to warranties, remedies, and damages. As a result, the sale of goods contract should include specified terms such as the following:

• Terms related to officer and acceptance
• Price and payment provisions
• Place of delivery of the goods
• Risk of loss provisions
• Warranties and warranty disclaimers
• Inspection rights
• Acceptance and rejection terms

Due to the ease in which a sale of goods contract may be formed, it is important to be represented by an attorney that has experience negotiating and preparing sale of goods contracts for sellers or buyers.