If you visit any online retailer and search for books about “the rules of business,” you are destined to find hundreds of results for books that pitch tips, tricks, secrets, and strategies on running a business, written by purported experts. Some books discuss tried and true methods of running businesses well. Some books are garbage. However, despite the quality of the advice, the one thing these books won’t teach you are the literal rules of business: the Uniform Commercial Code.
What is the Uniform Commercial Code?
The Uniform Commercial Code (“UCC”) is a collection of rules governing all sorts of business and commercial transactions in the United States. Like the name suggests, the purpose of the UCC was to make business law consistent throughout the country, thus facilitating a more predictable business environment. Technically, the UCC itself is not law, it is merely a list of guidelines. However, many states have either adopted the UCC verbatim or enacted laws very similar to UCC provisions.
What business activity does the UCC govern?
The short answer is: a lot. The UCC governs commercial transactions such as the negotiable instruments, securities and financial assets, and transactions secured by security interests. Article Two of the UCC specifically covers the sale of goods. It addresses questions such as:
- When is an offer irrevocable?
- When is a contract formed?
- What constitutes a breach of contract?
- If there has been a breach, what are the damages?
Why is this important to me?
Because it is the law, and violating the law means paying the price (literally). Running afoul of the UCC can be the difference between continuous growth for the next 20 quarters and a lawsuit that drains your resources and possibly kills your business. It does not matter whether you are an entrepreneur that is founding a start-up or the CEO of a multi-million dollar company, abiding by the UCC is fundamental to the success of your business.
Do you know the rules of business? If not, or if you have questions, seek qualified business law counsel. The Vethan Law Firm, P.C., has been in business for 20 years and has offices statewide. VLF gets results for the folks who are the backbone of this economy.