Commercial contracts—USA—Q&A guide

The following Commercial practice note provides comprehensive and up to date legal information covering:

  • Commercial contracts—USA—Q&A guide
  • 1. Is there an obligation to use good faith when negotiating a contract?
  • 2. How are ‘battle of the forms’ disputes resolved in your jurisdiction?
  • 3. Is there a legal requirement to draft the contract in the local language?
  • 4. Is it possible to agree a B2B contract online?
  • 5. Are there any statutory or other controls on parties’ freedom to agree terms in contracts between commercial parties in your jurisdiction?
  • 6. Are standard form contracts treated differently?
  • 7. What terms are implied by law into the contract? Is it possible to exclude these in a commercial relationship?
  • 8. Is your jurisdiction a signatory to the United Nations Convention on Contracts for the International Sale of Goods (the Vienna Convention)?
  • 9. Is there an obligation to use good faith when entering and performing a contract?
  • More...

Commercial contracts—USA—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to commercial contracts in USA published as part of the Lexology Getting the Deal Through series by Law Business Research (published: June 2020).

Authors: Greenberg Traurig LLP—Alan R. Greenfield; Christopher A Mair; Kyle L Flynn; Paul J. Ferak

1. Is there an obligation to use good faith when negotiating a contract?

In the United States, the Uniform Commercial Code (UCC) generally governs commercial agreements (such as supply contracts for the sale of goods and services), and has been codified by each state, with some states making modifications to certain UCC requirements. Thus, both state statutes and common law concerning commercial contracts vary among states, so a careful analysis of the state law governing the contract is recommended.

Generally, absent an agreement to negotiate in good faith, there is no such obligation for parties to negotiate a contract in good faith. Some parties may execute a preliminary agreement – such as a term sheet or letter of intent – as part of their negotiations before entering into a formal written contract, especially for more complex transactions. Often, such preliminary agreements include a provision that expressly states that the parties agree to negotiate the deal points within the term sheet or letter of intent in good faith. Some states will enforce these agreements to negotiate in good faith, while other

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