Contracts and Sales Multistate Bar Practice Exam

How does the UCC view discharge for impossibility or impracticability compared to common law?

1. The seller always assumes the risk of unforeseen events

2. Contracts cannot be modified under the UCC

3. The buyer assumes all risks associated with the contract

4. Performance is only excused if the seller explicitly states so

The correct answer is: The seller always assumes the risk of unforeseen events

The Uniform Commercial Code (UCC) approaches the concepts of impossibility and impracticability with a more flexible and pragmatic perspective compared to traditional common law. Under the UCC, the seller bears a significant responsibility for unforeseen events that may impact contract performance. This means that unless explicitly stated otherwise in the contract, the seller is generally expected to account for potential risks and undertake the burden of ensuring compliance with the contract despite changes in circumstances. If unforeseen events occur that substantially impede performance, the seller may still have limited options for discharge due to impossibility or impracticability. However, the standard under the UCC does not grant a blanket discharge for all unforeseen circumstances, as the seller is seen to have more responsibility for managing these risks in the sale of goods. In contrast, common law tends to offer a stricter framework where parties may be more readily excused from performance due to impossibility or impracticability, and these doctrines can lead to a discharge of obligations based on a narrower view of risk allocation. Overall, the UCC emphasizes the importance of the seller's commitment to manage expectations and risks, asserting that the seller assumes responsibility for unforeseen events unless otherwise specified in the contract terms.