BUS607 Assignment Week 5 State Consumer Protection

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BUS 607 Business Law for the Accountant

Instructor: Janet Fiorentino

UAGC

21/8/2022

State consumer protection

Consumer protection law

A consumer protection law in my state is made to protect consumers from the dangers of unsafe products and services. The law is called the “Uniform Commercial Code.” The purpose is to protect the consumer from being charged by a seller more than what the good or service is worth. Protection laws prohibit misleading and deceptive advertising (Llewellyn,2017).

Consumer protection laws are either implied or found in state statutes only. The Uniform Commercial Code (UCC), which is applicable in all states, provides two critical protections: the right to rescind contract clauses that were fraudulently concealed and a right of action for rescission of contracts entered into by persons under the age of 18 if their parent or guardian did not approve of their doing so.

Protection laws are designed to prohibit misleading and deceptive advertising. The consumer protection law in my state will protect the consumers from any business making a fraudulent statement about its product or service (Llewellyn,2017). The law is against a seller that will make a false statement about the quality and characteristics of the product or service, and also, a seller will charge a consumer more than what the good or service is worth. Consumer protection laws are either implied or found in state statutes only. The Uniform Commercial Code (UCC), which is applicable in all states, provides two critical protections: the right to rescind contract clauses that were fraudulently concealed and a right of action for rescission of contracts entered into by persons under the age of 18 if their parent or guardian did not approve of their doing so. The law aims to protect consumers from the danger that defective or toxic substances can cause, especially if people cannot quickly identify a safe product.

Industry and business types are affected.

The industry that Uniform Commercial Code affects is the manufacturing and production of agricultural, mining, and other natural resources. The Uniform Commercial Code affects the manufacturing industry by providing guidelines on handling contracts and establishing a system of warranties. The Uniform Commercial Code applies to the sale and purchase of goods, how goods are transported and received, the title passed in interests, and the financing of such transactions. The Uniform Commercial Code governs the manufacturing process. It consists of any strategy that produces goods for sale and anything used in making such products. For example, cutting yarn could be considered part of manufacturing and the process of packaging (for retail) or creating parts for a product (manufacturing).

The Uniform Commercial Code affects the production industry by providing guidelines to be followed when producing in an assembly line process. The Uniform Commercial Code applies to manufacture products and parts and products manufactured by assembling components. As such, the uniform code covers a range of industries, which includes but is not limited to computer software, audio/video recording, oil and gas production (including oil pipelines), mining and quarrying, food processing, service industry production (including construction), telecommunications, broadcasting, transportation (aviation industry), pharmaceuticals and other chemicals (including electric power transmission). The Code determines what has been deemed a sale and what is not.

Types of businesses affected by the UCC are retail and wholesale (Danzig,2017). The law affects businesses, but only those businesses registered under the Uniform Commercial

Code. Companies that are not incorporated or registered under the UCC laws do not have to comply with the requirements of the UCC. The Uniform Commercial Code has a set of rules similar to copyright and trademark law. It governs business transactions, such as lending money, buying/selling property, and leasing commercial property. Unlike federal law, which enforces intellectual property rights for corporations and individuals directly related to a company’s activities in a particular industry or country, it does not cover individual owners or designs for unique products.

Changes to implement

To comply with the Uniform Commercial Code, a business must have a formal written contract and evidence of the parties' acceptance of the agreement, such as exchanging money or goods. The arrangement of the Uniform Commercial Code requires a business to act in good faith and treat the other party with respect at all times (Danzig,2017). This is an “implied covenant of good faith and fair dealing” and is crucial to wills enforceability. If a business fails to engage in good faith by providing false or misleading information, the other party may have a claim against them in court.

The contract also requires the business to do what it can to reach a mutual agreement with the other party. For example, if a business is going to ship goods out and is not able to fulfill the contract due to financial problems, the business would have to notify the other party of this fact and allow time for them to agree on a way for the company and client to work around the problem. If this does not occur within a reasonable amount of time, there may be a claim against the business for failing to fulfill its obligations under its contract.

The Uniform Commercial Code also governs electronic commerce. It dictates that any electronic content needs a valid signature or external mark (such as an “@” sign) that demonstrates where such content was created from. If this is not present, the other party has no legal obligation to the contract.

Lastly, the business must fulfill its contractual obligations promptly (Braucher,2018). If they fail to do so, it may result in a breach of contract or warranty. A warranty violation occurs when an error in the documentation prevents one party from fulfilling its obligations under its contract to another party. If a business commits a breach of warranty by failing to disclose such information, then the other party can void their contract entirely if they determine that such information would have originally influenced the contract’s signing.

Effectiveness

In meeting its objectives, the Uniform Commercial Code is effective. The Uniform

Commercial Code is a US federal law establishing rules for commercial transactions within the United States (Braucher,2018). It has been in effect since 1921 and operates as an alternative to state laws governing contracts. The Code has established uniformity in contract law to provide legal certainty and protect against conflicts between contracts entered into by parties located in different states or countries. The Code also provides a means of resolving disputes between parties without resorting to lengthy litigation or expensive private arbitration proceedings. The law has been able to accomplish its aim by providing uniform rules, which mean they apply equally to all who enter into commercial transactions. The Code also demonstrates effectiveness in its ability to meet diverse needs; it provides a definitive set of rules which can be applied consistently across all states within the US and other countries. The Code also permits flexibility, enabling variable terms to be agreed upon by contracting parties.

References

Braucher, R. (2018). Legislative History of the Uniform Commercial Code, The. Colum. L. Rev.

, 58, 798.

Danzig, R. (2017). A Comment on the jurisprudence of the Uniform Commercial Code. Stan L.

Rev., 27, 621.

Llewellyn, K. N. (2017). Why We Need the Uniform Commercial Code. U. Fla. L. Rev., 10, 367.