what is course of dealing

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. UCC

§ 1-303 (b).

Full Answer

What does course of dealing mean in law?

A clearly recognizable pattern of previous conduct between parties to a business transaction. The course of dealing between parties to an action is examined by a court in ascertaining what the parties intended when they entered into a contract.

What is the course of dealing between parties to an action?

The course of dealing between parties to an action is examined by a court in ascertaining what the parties intended when they entered into a contract. The supposition is that the parties drew up the contract in view of the customary manner in which business had been transacted prior to the signing of the contract.

What is a course of dealing under the UCC?

The UCC defines course of dealing in its general provisions (U.C.C. § 1-205). The term applies, for example, to the laws governing contracts for the sale of goods, negotiable instruments, and Secured Transactions. West's Encyclopedia of American Law, edition 2.

When do express terms prevail over the course of dealing?

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.

What is meant by a course of dealing?

(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.

What is an example of course of dealing?

The UCC defines course of dealing in its general provisions (U.C.C. § 1-205). The term applies, for example, to the laws governing contracts for the sale of goods, negotiable instruments, and Secured Transactions.

What is course of dealing in contract law?

Often used to aid in contract interpretation, a course of dealing is a sequence of previous conduct between the parties which is regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.

What is the difference between the terms course of dealing and course of performance?

"Course of dealing," as defined in subsection (b), is restricted, literally, to a sequence of conduct between the parties previous to the agreement. A sequence of conduct after or under the agreement, however, is a "course of performance."

What is the difference between course of performance course of dealing and usage of trade and what impact can the different phrases have on a contract?

Course of performance refers to a pattern of conduct that occurs subsequent to approval of the contract terms. Trade usage entails behavior that is the standard of conformity for a majority of businesses engaged in a particular business or commercial venture.

Does course of performance override course of dealing?

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.

Is course of dealing parol evidence?

UCC § 2-202(a) allows three types of evidence -- usage of trade, course of dealing, and course of performance -- to explain or supplement a term contained in the writing even if the parties intended the writing to be complete and exclusive.

What does UCC 1 103 mean?

UCC 1-103 is a provision in the Uniform Commercial Code intended to provide direction to the court on how to interpret its provisions. UCC 1-103(a) states that the provisions of UCC must be construed and applied in light of one another, liberally, broadly and in such a way to promote its purpose, objective and policies.

What is promissory estoppel?

Within contract law, promissory estoppel refers to the doctrine that a party may recover on the basis of a promise made when the party's reliance on that promise was reasonable, and the party attempting to recover detrimentally relied on the promise.

What does the term course of performance mean when it comes to interpreting the meaning of language in a contract?

Evidence of the conduct of parties concerning the execution of obligations under a contract requiring more than one performance that is used for the purpose of interpreting the contract's provisions.

What is the Contra Proferentem rule?

The contra proferentem rule states, broadly, that where there is doubt about the meaning of the contract, the words will be construed against the person who put them forward.

What does commercially impractical mean?

Commercial impracticability means that performance under a contract is impracticable, and cannot be accomplished. This means that it is either difficult or impossible to perform under the contract.

What is course of dealing?

The term course of dealing is defined in the Uniform Commercial Code as follows: 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.

Where is the term "course of dealing" used?

Although the term is usually used in US contract law, where the parties' course of dealing helps the court to understand the intention of the contracting parties, it is also used elsewhere in the law.

Why is prosecution history important?

The prosecution history often proves useful in determining a patent's scope , for it reveals the course of dealing with the Patent Office , which may show a particular meaning attached to the terms, or a position taken by the applicant to ensure that the patent would issue .