Once again, my optimism has proved unfounded. This week the American Law Institute approved a number of proposed amendments to Article 2 of the Uniform Commercial Code. That’s bad news for opponents of UCITA.
As I explained in my previous post on this subject, UCC Article 2 is a very fundamental law governing sales of goods. The approved amendments are somewhat nebulous in their effect, but there’s no doubt they will leave the door open for more UCITA-like decisions by courts. And there’s at least a possibility they will leave the door open for UCITA itself to be enacted in more states. (For background information on UCITA, please visit the AFFECT coalition website.)
Obviously, I will have more to say about this in the future, but let me say there is no cause for panic in the streets just yet. At the earliest, revised Article 2 is unlikely to be introduced in any state legislatures before next year. And so many different interest groups have serious problems with it (even some ardent UCITA supporters opposed the amendments on other grounds), it’s not clear if anyone is going to be pushing for its enactment any time soon. That doesn’t mean there will no damage done, however. Stay tuned and you’ll see what I mean.
