Contracts and Sales Multistate Bar Practice Exam

How does the UCC handle the Parol Evidence Rule differently from common law?

1. UCC allows only for complete contracts

2. UCC contracts are always fully integrated

3. UCC presumes all contracts are partial integrations

4. UCC disallows any additional terms

The correct answer is: UCC presumes all contracts are partial integrations

The Uniform Commercial Code (UCC) modifies the traditional application of the Parol Evidence Rule, reflecting a more flexible approach to dealing with the integration of contracts. Under the UCC, there is a presumption that most contracts are partially integrated, meaning that they include some, but not all, of the terms agreed upon by the parties. This perspective allows for the introduction of additional consistent terms that may not be included in the written contract, accommodating the complexities often present in commercial transactions. In essence, this principle facilitates the admission of supplementary evidence to clarify or complete the intentions of the parties. This contrasts with common law, which tends to be more rigid in its application of the Parol Evidence Rule, often viewing written contracts as fully integrated unless there is compelling evidence to suggest otherwise. The UCC's approach acknowledges the dynamic nature of commercial relationships and seeks to uphold the parties' true intentions, allowing for a more elastic interpretation of contract terms. This understanding is essential for those dealing with commercial agreements, as it highlights the UCC's acknowledgment of the realities of business transactions and the need for some flexibility when interpreting contracts.