Okla. Stat. tit. 12A § 1-103

Current through Laws 2024, c. 378.

Section 1-103 - Construction of Uniform Commercial Code to promote its purposes and policies - Applicability of supplemental principles of law

(a) The Uniform Commercial Code shall be liberally construed and applied to promote its underlying purposes and policies, which are:

(1) to simplify, clarify and modernize the law governing commercial transactions;

(2) to permit the continued expansion of commercial practices through custom, usage and agreement of the parties; and

(3) to make uniform the law among the various jurisdictions.

(b) Unless displaced by the particular provisions of the Uniform Commercial Code, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause shall supplement its provisions.

Okla. Stat. tit. 12A, § 1-103

Added by Laws 1961, p. 69, § 1-103; Amended by Laws 2005 , HB 2028, c. 139, § 3, eff. 1/1/2006.

Oklahoma Code Comment

As with the preceding section (see Oklahoma Code Comment to section 1-102 ), this provision highlights sometimes important line-drawing issues, in this section as between the UCC and supplementary rules of law and equity. Revised section 1-103(a)(2) is drawn from old section 1-102(1) and (2) and is consistent with Oklahoma case law acknowledging the intent of the UCC to recognize and reinforce general commercial practice and the intent of the parties, as established through custom usage and the agreement of the parties. See Goss v. Trinity Sav. & Loan Ass'n, 813 P.2d 492 (Okla. 1991). This is, of course, limited by generally recognized restrictions based on public policy. See, e.g., Fisk v. Bullard, 239 P.2d 424 (Okla. 1951). See also the limitations on variation by agreement, at revised section 1-302 (moved there from old section 1-102(3) ).

Section 1-103(b) carries forward the language and effect of prior Oklahoma Law. See, e.g., prior statutory provisions at: 2 Okla. Stat. § 9-115; 12 Okla. Stat. § 2; 18 Okla. Stat. § 1.106; and 48 Okla. Stat. § 7. See also related UCC scope rules at 12A Okla. Stat. § 2-102 and section 2-108 of revised Article 2 (2005 uniform text); and 12A Okla. Stat. § 2A-104 and § 2A-104 (2005 uniform text).

See generally Central National Bank and Trust Co. of Enid, 528 P.2d 710 (Okla. 1974) (estoppel); Peoples National Bank v. Uhlenhake, 712 P.2d 75 (Okla. App. 1985) (same); W.R. Grimshaw Co. v. First National Bank & Trust Co. of Tulsa, 563 P.2d 117 (Okla. 1977). Note, however, that supplementation is limited to issues not displaced by provisions of the UCC.