Law for Accountants Hw1

1. What is the difference between a contract for the sale of goods and a contract for the sale of services?

Contracts for the sale of services is an agreement with specific terms between two or more parties in which there is a promise to complete work or duties in return for a valuable benefit or consideration. A contract for the sale of goods is a contract where the seller transfers or agrees to transfer property or goods to the buyer for a monetary consideration.

2. What law governs each?

Common law governs contracts for the sale of services or real property. Common law is judge-made law, where court cases are decided based on prior cases know as precedent. Common law of contracts is similar in all states, but there are minor differences among all states.

The Uniform Commercial Code, specifically Article 2, is the law that governs contracts for the sale of goods. The UCC has been enacted by all states with some variation and some omissions.

3. What did the court decide? That is, did the court decide that the contract in question was a contract for the sale of services or a contract for the sale of goods?

The Tennessee Court of Appeals decided that the contract in question was a contract for the sale of services. The Appeals Court determined the predominant purpose of the transaction in question was a service based due to the language of the parties’ contract, the nature of the business of the supplier of the goods and services, and the reason the parties entered into the contract.