Article 2 of the UCC applies to transactions in goods and provides rules on the formation, performance, and enforcement of contracts for the sale of goods. It covers terms of the contract, including payment, delivery, and risk of loss. It also addresses warranties, both express and implied, and provides remedies for breach of contract. While the UCC has been adopted in some form by all 50 states, it is not a federal statute but a uniform state law. Parties to a vendor agreement should ensure their contract complies with the applicable state's version of the UCC.
The E-SIGN Act facilitates the use of electronic records and signatures in interstate and foreign commerce by ensuring the validity and legal effect of contracts entered into electronically. It establishes that electronic signatures and records are as legally binding as their paper equivalents, thus allowing for fully electronic vendor agreements. The Act requires that consumers must consent to the use of electronic records and must be provided with clear and conspicuous information about their rights regarding electronic transactions.
The FTC Act empowers the Federal Trade Commission to prevent unfair or deceptive acts or practices in or affecting commerce. This includes the enforcement of truth-in-advertising laws, which can impact the marketing and sale of goods and services in vendor agreements. The Act also addresses antitrust issues by prohibiting unfair methods of competition. Vendor agreements that include misleading terms or result in anti-competitive practices may be subject to enforcement actions under the FTC Act.
TILA aims to promote the informed use of consumer credit by requiring disclosures about its terms and cost. The Act also provides for the right of rescission in certain transactions, regulates credit card practices, and provides a regulatory framework for fair billing practices. If a vendor agreement involves the extension of credit to the purchaser, particularly if the purchaser is a consumer, the vendor must ensure compliance with TILA's disclosure and billing requirements.
The Sherman Antitrust Act prohibits business activities that are anticompetitive, and it requires the federal government to investigate and pursue trusts, companies, and organizations suspected of being in violation. It covers various activities including price fixing, monopolies, and other practices that could unfairly restrict trade. Vendor agreements that include exclusivity clauses or other terms that could be seen as anticompetitive may need to be reviewed for compliance with the Sherman Act.
The Bankruptcy Code provides the legal framework for bankruptcy proceedings in the United States. It outlines the rights and obligations of debtors and creditors, including those involved in vendor agreements. If a party to a vendor agreement becomes bankrupt, the Code determines the treatment of the contract and the ability of the non-bankrupt party to claim for goods supplied or for damages. Executory contracts, such as ongoing vendor agreements, may be assumed or rejected by the bankruptcy trustee.
The Federal Arbitration Act provides the legal basis for the enforcement of arbitration agreements and awards. It applies to any arbitration agreement within the scope of interstate commerce. The Act ensures that arbitration clauses in contracts are as enforceable as other contract terms, and it limits the ability of courts to review arbitration awards. Vendor agreements that include provisions for arbitration should comply with the requirements of this Act.