Usa Alabama

USA Statutes : alabama
Title : Title 07 COMMERCIAL CODE.
Chapter : Article 1 GENERAL PROVISIONS.
Section 7-1-101

Section 7-1-101
Short title.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

This title shall be known and may be cited as Uniform Commercial Code.



(Acts 1965, No. 549, p. 811.)Section 7-1-102

Section 7-1-102
Purposes; rules of construction; variation by agreement.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) This title shall be liberally construed and applied to promote its underlying purposes and policies.

(2) Underlying purposes and policies of this title are:

(a) To simplify, clarify and modernize the law governing commercial transactions;

(b) To permit the continued expansion of commercial practices through custom, usage and agreement of the parties;

(c) To make uniform the law among the various jurisdictions.

(3) The effect of provisions of this title may be varied by agreement, except as otherwise provided in this title and except that the obligations of good faith, diligence, reasonableness and care prescribed by this title may not be disclaimed by agreement but the parties may by agreement determine the standards by which the performance of such obligations is to be measured if such standards are not manifestly unreasonable.

(4) The presence in certain provisions of this title of the words 'unless otherwise agreed' or words of similar import does not imply that the effect of other provisions may not be varied by agreement under subsection (3).

(5) In this title unless the context otherwise requires:

(a) Words in the singular number include the plural, and in the plural include the singular;

(b) Words of the masculine gender include the feminine and the neuter, and when the sense so indicates words of the neuter gender may refer to any gender.



(Acts 1965, No. 549, p. 811.)Section 7-1-103

Section 7-1-103
Supplementary general principles of law applicable.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

Unless displaced by the particular provisions of this title, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause shall supplement its provisions.



(Acts 1965, No. 549, p. 811.)Section 7-1-104

Section 7-1-104
Construction against implicit repeal.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

This title being a general act intended as a unified coverage of its subject matter, no part of it shall be deemed to be impliedly repealed by subsequent legislation if such construction can reasonably be avoided.



(Acts 1965, No. 549, p. 811.)Section 7-1-105

Section 7-1-105
Territorial application of title; parties' power to choose applicable law.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) Except as provided in this section, when a transaction bears a reasonable relation to this state and also to another state or nation the parties may agree that the law either of this state or of such other state or nation shall govern their rights and duties. Failing such agreement, this title applies to transactions bearing an appropriate relation to this state.

(2) Where one of the following provisions of this title specifies the applicable law, that provision governs and a contrary agreement is effective only to the extent permitted by the law (including the conflict of laws rules) so specified:

Rights of creditors against sold goods. Section 7-2-402.

Applicability of the article on leases. Sections 7-2A-105 and 7-2A-106.

Applicability of the article on bank deposits and collections. Section 7-4-102.

Governing law in the article on funds transfers. Section 7-4A-507.

Letters of Credit. Section 7-5-116.

Applicability of the article on investment securities. Section 7-8-106.

Law governing perfection, the effect of perfection or nonperfection, and the priority of security interests and agricultural liens. Sections 7-9A-301 through 7-9A-307.



(Acts 1965, No. 549, p. 811; Acts 1981, No. 81-312, p. 399; Acts 1992, 2nd Ex. Sess., No. 92-700, §601; Acts 1992, 2nd Ex. Sess., No. 92-701, p. 145, §2; Acts 1996, No. 96-742, p. 1241, § 4; Acts 1997, No. 97-702, p. 1427, §2; Act 2001-481, p. 647, §2.)Section 7-1-106

Section 7-1-106
Remedies to be liberally administered.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) The remedies provided by this title shall be liberally administered to the end that the aggrieved party may be put in as good a position as if the other party had fully performed but neither consequential or special nor penal damages may be had except as specifically provided in this title or by other rule of law.

(2) Any right or obligation declared by this title is enforceable by action unless the provision declaring it specifies a different and limited effect.



(Acts 1965, No. 549, p. 811.)Section 7-1-107

Section 7-1-107
Waiver or renunciation of claim or right after breach.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

Any claim or right arising out of an alleged breach can be discharged in whole or in part without consideration by a written waiver or renunciation signed and delivered by the aggrieved party.



(Acts 1965, No. 549, p. 811.)Section 7-1-108

Section 7-1-108
Severability.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

If any provision or clause of this title or application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the title which can be given effect without the invalid provision or application, and to this end the provisions of this title are declared to be severable.



(Acts 1965, No. 549, p. 811.)Section 7-1-109

Section 7-1-109
(Repealed effective January 1, 2005) Section captions.

THIS SECTION WAS REPEALED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

Section captions are parts of this title.



(Acts 1965, No. 549, p. 811.)Section 7-1-201

Section 7-1-201
(Effective January 1, 2005) General definitions.

THIS SECTION WAS ASSIGNED BY THE CODE COMMISSIONER. THIS SECTION HAS NOT BEEN CODIFIED BY THE LEGISLATURE.

(a) [Reserved].

(b) Subject to additional definitions contained in the subsequent articles of this title which are applicable to specific articles or parts thereof, and unless the context otherwise requires, in this title:

(1) 'Action,' in the sense of a judicial proceeding, includes recoupment, counterclaim, set-off, suit in equity, and any other proceeding in which rights are determined.

(2) 'Aggrieved party' means a party entitled to pursue a remedy.

(3) 'Agreement,' as distinguished from 'contract,' means the bargain of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in Section 7-1-303.

(4) 'Bank' means a person engaged in the business of banking and includes a savings bank, savings and loan association, credit union, and trust company.

(5) 'Bearer' means a person in possession of a negotiable instrument, document of title, or certificated security that is payable to bearer or indorsed in blank.

(6) 'Bill of lading' means a document evidencing the receipt of goods for shipment issued by a person engaged in the business of transporting or forwarding goods.

(7) 'Branch' includes a separately incorporated foreign branch of a bank.

(8) 'Burden of establishing' a fact means the burden of persuading the trier of fact that the existence of the fact is more probable than its nonexistence.

(9) 'Buyer in ordinary course of business' means a person that buys goods in good faith, without knowledge that the sale violates the rights of another person in the goods, and in the ordinary course from a person, other than a pawnbroker, in the business of selling goods of that kind. A person buys goods in the ordinary course if the sale to the person comports with the usual or customary practices in the kind of business in which the seller is engaged or with the seller's own usual or customary practices. A person that sells oil, gas, or other minerals at the wellhead or mine is a person in the business of selling goods of that kind. A buyer in ordinary course of business may buy for cash, by exchange of other property, or on secured or unsecured credit, and may acquire goods or documents of title under a preexisting contract for sale. Only a buyer that takes possession of the goods or has a right to recover the goods from the seller under Article 2 may be a buyer in ordinary course of business. 'Buyer in ordinary course of business' does not include a person that acquires goods in a transfer in bulk or as security for or in total or partial satisfaction of a money debt.

(10) 'Conspicuous,' with reference to a term, means so written, displayed, or presented that a reasonable person against which it is to operate ought to have noticed it. Whether a term is 'conspicuous' or not is a decision for the court. Conspicuous terms include the following:

(A) A heading in capitals equal to or greater in size than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same or lesser size; and

(B) Language in the body of a record or display in larger type than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same size, or set off from surrounding text of the same size by symbols or other marks that call attention to the language.

(11) 'Consumer' means an individual who enters into a transaction primarily for personal, family, or household purposes.

(12) 'Contract,' as distinguished from 'agreement,' means the total legal obligation that results from the parties' agreement as determined by this title as supplemented by any other applicable laws.

(13) 'Creditor' includes a general creditor, a secured creditor, a lien creditor, and any representative of creditors, including an assignee for the benefit of creditors, a trustee in bankruptcy, a receiver in equity, and an executor or administrator of an insolvent debtor's or assignor's estate.

(14) 'Defendant' includes a person in the position of defendant in a counterclaim, cross-claim, or third-party claim.

(15) 'Delivery,' with respect to an instrument, document of title, or chattel paper, means voluntary transfer of possession.

(16) 'Document of title' includes bill of lading, dock warrant, dock receipt, warehouse receipt or order for the delivery of goods, and also any other document which in the regular course of business or financing is treated as adequately evidencing that the person in possession of it is entitled to receive, hold, and dispose of the document and the goods it covers. To be a document of title, a document must purport to be issued by or addressed to a bailee and purport to cover goods in the bailee's possession which are either identified or are fungible portions of an identified mass.

(17) 'Fault' means a default, breach, or wrongful act or omission.

(18) 'Fungible goods' means:

(A) Goods of which any unit, by nature or usage of trade, is the equivalent of any other like unit; or

(B) Goods that by agreement are treated as equivalent.

(19) 'Genuine' means free of forgery or counterfeiting.

(20) 'Good faith' means honesty in fact in the conduct or transaction concerned.

(21) 'Holder' means:

(A) The person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession; or

(B) The person in possession of a document of title if the goods are deliverable either to bearer or to the order of the person in possession.

(22) 'Insolvency proceeding' includes an assignment for the benefit of creditors or other proceeding intended to liquidate or rehabilitate the estate of the person involved.

(23) 'Insolvent' means:

(A) Having generally ceased to pay debts in the ordinary course of business other than as a result of bona fide dispute;

(B) Being unable to pay debts as they become due; or

(C) Being insolvent within the meaning of federal bankruptcy law.

(24) 'Money' means a medium of exchange currently authorized or adopted by a domestic or foreign government. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more countries.

(25) 'Organization' means a person other than an individual.

(26) 'Party,' as distinguished from 'third party,' means a person that has engaged in a transaction or made an agreement subject to this title.

(27) 'Person' means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government, governmental subdivision, agency, or instrumentality, or any other legal or commercial entity.

(28) 'Present value' means the amount as of a date certain of one or more sums payable in the future, discounted to the date certain by use of either an interest rate specified by the parties if that rate is not manifestly unreasonable at the time the transaction is entered into or, if an interest rate is not so specified, a commercially reasonable rate that takes into account the facts and circumstances at the time the transaction is entered into.

(29) 'Purchase' means taking by sale, lease, discount, negotiation, mortgage, pledge, lien, security interest, issue or reissue, gift, or any other voluntary transaction creating an interest in property.

(30) 'Purchaser' means a person that takes by purchase.

(31) 'Record' means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

(32) 'Remedy' means any remedial right to which an aggrieved party is entitled with or without resort to a tribunal.

(33) 'Representative' means a person empowered to act for another, including an agent, an officer of a corporation or association, and a trustee, executor, or administrator of an estate.

(34) 'Right' includes remedy.

(35) 'Security interest' means an interest in personal property or fixtures which secures payment or performance of an obligation. 'Security interest' includes any interest of a consignor and a buyer of accounts, chattel paper, a payment intangible, or a promissory note in a transaction that is subject to Article 9A. 'Security interest' does not include the special property interest of a buyer of goods on identification of those goods to a contract for sale under Section 7-2-401, but a buyer may also acquire a 'security interest' by complying with Article 9A. Except as otherwise provided in Section 7-2-505, the right of a seller or lessor of goods under Article 2 or 2A to retain or acquire possession of the goods is not a 'security interest,' but a seller or lessor may also acquire a 'security interest' by complying with Article 9A. The retention or reservation of title by a seller of goods notwithstanding shipment or delivery to the buyer under Section 7-2-401 is limited in effect to a reservation of a 'security interest.' Whether a transaction in the form of a lease creates a 'security interest' is determined pursuant to Section 7-1-203.

(36) 'Send' in connection with a writing, record, or notice means:

(A) To deposit in the mail or deliver for transmission by any other usual means of communication with postage or cost of transmission provided for and properly addressed and, in the case of an instrument, to an address specified thereon or otherwise agreed, or if there be none to any address reasonable under the circumstances; or

(B) In any other way to cause to be received any record or notice within the time it would have arrived if properly sent.

(37) 'Signed' includes using any symbol executed or adopted with present intention to adopt or accept a writing.

(38) 'State' means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.

(39) 'Surety' includes a guarantor or other secondary obligor.

(40) 'Term' means a portion of an agreement that relates to a particular matter.

(41) 'Unauthorized signature' means a signature made without actual, implied, or apparent authority. The term includes a forgery.

(42) 'Warehouse receipt' means a receipt issued by a person engaged in the business of storing goods for hire.

(43) 'Writing' includes printing, typewriting, or any other intentional reduction to tangible form. 'Written' has a corresponding meaning.



(Prior version of this section added by Acts 1965, No. 549, p. 811; amended by Acts 1981, No. 81-312, p. 399; Acts 1991, No. 91-654, p. 1232, §1; Acts 1992, 2nd Ex. Sess., No. 92-700, p. 92, §602; Acts 1995, No. 95-668, p. 1381, §4; Acts 1996, No. 96-742, p. 1241, §4; Act 2001-481, p. 647, §2; Act 2004-315, §2; repealed by Act 2004-524, §§1, 3; current section added by Act 2004-524, §1.)Section 7-1-202

Section 7-1-202
Prima facie evidence by third-party documents.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

A document in due form purporting to be a bill of lading, policy or certificate of insurance, official weigher's or inspector's certificate, consular invoice, or any other document authorized or required by the contract to be issued by a third party shall be prima facie evidence of its own authenticity and genuineness and of the facts stated in the document by the third party.



(Acts 1965, No. 549, p. 811.)Section 7-1-203

Section 7-1-203
Obligation of good faith.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

Every contract or duty within this title imposes an obligation of good faith in its performance or enforcement.



(Acts 1965, No. 549, p. 811.)Section 7-1-204

Section 7-1-204
Time; reasonable time; 'seasonably'.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) Whenever this title requires any action to be taken within a reasonable time, any time which is not manifestly unreasonable may be fixed by agreement.

(2) What is a reasonable time for taking any action depends on the nature, purpose and circumstances of such action.

(3) An action is taken 'seasonably' when it is taken at or within the time agreed or if no time is agreed at or within a reasonable time.



(Acts 1965, No. 549, p. 811.)Section 7-1-205

Section 7-1-205
Course of dealing and usage of trade.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) A course of dealing is a sequence of previous conduct between the parties to a particular transaction which is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.

(2) A usage of trade is any practice or method of dealing having such regularity of observance in a place, vocation or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage are to be proved as facts. If it is established that such a usage is embodied in a written trade code or similar writing the interpretation of the writing is for the court.

(3) A course of dealing between parties and any usage of trade in the vocation or trade in which they are engaged or of which they are or should be aware give particular meaning to and supplement or qualify terms of an agreement.

(4) The express terms of an agreement and an applicable course of dealing or usage of trade shall be construed wherever reasonable as consistent with each other; but when such construction is unreasonable, express terms control both course of dealing and usage of trade and course of dealing controls usage of trade.

(5) An applicable usage of trade in the place where any part of performance is to occur shall be used in interpreting the agreement as to that part of the performance.

(6) Evidence of a relevant usage of trade offered by one party is not admissible unless and until he has given the other party such notice as the court finds sufficient to prevent unfair surprise to the latter.



(Acts 1965, No. 549, p. 811.)Section 7-1-206

Section 7-1-206
Statute of frauds for kinds of personal property not otherwise covered.

THIS SECTION IS REPEALED AND REPLACED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) Except in the cases described in subsection (2) of this section a contract for the sale of personal property is not enforceable by way of action or defense beyond $5,000.00 in amount or value of remedy unless there is some writing which indicates that a contract for sale has been made between the parties at a defined or stated price, reasonably identifies the subject matter, and is signed by the party against whom enforcement is sought or by his authorized agent.

(2) Subsection (1) of this section does not apply to contracts for the sale of goods (Section 7-2-201) nor of securities (Section 7-8-113) nor to security agreements (Sections 7-9A-201 and 7-9A-203).



(Acts 1965, No. 549, p. 811; Acts 1996, No. 96-742, p. 1241, §4; Act 2001-481, p. 647, §2.)Section 7-1-207

Section 7-1-207
(Repealed effective January 1, 2005) Performance or acceptance under reservation of rights.

THIS SECTION WAS REPEALED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

(1) A party who with explicit reservation of rights performs or promises performance or assents to performance in a manner demanded or offered by the other party does not thereby prejudice the rights reserved. Such words as 'without prejudice,' 'under protest' or the like are sufficient.

(2) Subdivision (1) does not apply to an accord and satisfaction.



(Acts 1965, No. 549, p. 811; Acts 1995, No. 95-668, p. 1381, §4.)Section 7-1-208

Section 7-1-208
(Repealed effective January 1, 2005) Option to accelerate at will.

THIS SECTION WAS REPEALED IN THE 2004 REGULAR SESSION BY ACT 2004-524, EFFECTIVE JANUARY 1, 2005.

A term providing that one party or his successor in interest may accelerate payment or performance or require collateral or additional collateral 'at will' or 'when he deems himself insecure' or in words of similar import shall be construed to mean that he shall have power to do so only if he in good faith believes that the prospect of payment or performance is impaired. The burden of establishing lack of good faith is on the party against whom the power has been exercised.



(Acts 1965, No. 549, p. 811.)Section 7-1-303

Section 7-1-303
(effective January 1, 2005) Course of performance, course of dealing, and usage of trade. THIS SECTION WAS ASSIGNED BY THE CODE COMMISSIONER. THIS SECTION HAS NOT BEEN CODIFIED BY THE LEGISLATURE.

(a) A 'course of performance' is a sequence of conduct between the parties to a particular transaction that exists if:

(1) The agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and

(2) The other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection.

(b) A 'course of dealing' is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.

(c) A 'usage of trade' is any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.

(d) A course of performance or course of dealing between the parties or usage of trade in the vocation or trade in which they are engaged or of which they are or should be aware is relevant in ascertaining the meaning of the parties' agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the agreement. A usage of trade applicable in the place in which part of the performance under the agreement is to occur may be so utilized as to that part of the performance.

(e) Except as otherwise provided in subsection (f), the express terms of an agreement and any applicable course of performance, course of dealing, or usage of trade must be construed whenever reasonable as consistent with each other. If such a construction is unreasonable:

(1) Express terms prevail over course of performance, course of dealing, and usage of trade;

(2) Course of performance prevails over course of dealing and usage of trade; and

(3) Course of dealing prevails over usage of trade.

(f) Subject to Section 7-2-209, a course of performance is relevant to show a waiver or modification of any term inconsistent with the course of performance.

(g) Evidence of a relevant usage of trade offered by one party is not admissible unless that party has given the other party notice that the court finds sufficient to prevent unfair surprise to the other party.



(Act 2004-524, §1.)

USA Statutes : alabama