HB 195 — Revise the Ohio Uniform Commercial Code

Short titles [UCC 1-101] 52 (A) Chapters 1301., 1302., 1303., 1304., 1305., 1307., 53 1308., 1309., and 1310., and 1314.

of the Revised Code may be 54 cited as the Uniform Commercial Code.

55 (B) Sections 1301.101 to 1301.310 of the Revised Code may 56 be cited as Uniform Commercial Code – General Provisions.

57 (C) This chapter uses the numbering system of the national 58 conference of commissioners on uniform state laws.

The digits to 59 the right of the decimal point are sequential and not 60 supplemental to any preceding Revised Code section.

61 Sec.

[UCC 1-102] 62 Sections 1301.101 to 1301.310 of the Revised Code apply to 63 a transaction to the extent that it is governed by Chapter 64 1302., 1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 65 1314.

66 Sec.

Construction of Uniform Commercial Code to 67 promote its purposes and policies;

applicability of supplemental 68 principles of law [UCC 1-103] 69 (A) Chapters 1301., 1302., 1303., 1304, 1305., 1307., 70 1308., 1309., and 1310., and 1314.

of the Revised Code must be 71 liberally construed and applied to promote their underlying 72 purposes and policies, which are:

73 (1) To simplify, clarify, and modernize the law governing 74 commercial transactions;

75 (2) To permit the continued expansion of commercial 76practices H.through custom, usage, and agreement of the parties;

B.and (3) To make uniform the law among the various jurisdictions.

No.(B) Unless displaced by the particular provisions of Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

195of Pagethe 4Revised AsCode, Passedthe byprinciples of law and equity, including the Houselaw practicesmerchant throughand custom,the usage,law relative to capacity to contract, principal and agreementagent, ofestoppel, thefraud, parties;misrepresentation, duress, coercion, mistake, bankruptcy, and other validating or invalidating cause supplement their provisions.

77Sec. and 78 (3) To make uniform the law among the various 79 jurisdictions.

80 (B) Unless displaced by the particular provisions of 81 Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., 82 and 1310., and 1314.

of the Revised Code, the principles of law 83 and equity, including the law merchant and the law relative to 84 capacity to contract, principal and agent, estoppel, fraud, 85 misrepresentation, duress, coercion, mistake, bankruptcy, and 86 other validating or invalidating cause supplement their 87 provisions.

88 Sec.

Construction against implied repeal [UCC 1-1-104] 89 104] 90 Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 91 1309., and 1310., and 1314.

of the Revised Code being a general 92 act intended as a unified coverage of its subject matter, no 93 part of it shall be deemed to be impliedly repealed by 94 subsequent legislation if such construction can reasonably be 95 avoided.

96 Sec.

Severability [UCC 1-105] 97 If any provision or clause of Chapter 1301., 1302., 1303., 98 1304., 1305., 1307., 1308., 1309., or 1310., or 1314.

of the 99 Revised Code or its application to any person or circumstance is 100 held invalid, the invalidity does not affect other provisions or 101 applications of Chapter 1301., 1302., 1303., 1304., 1305., 102 1307., 1308., 1309., or 1310., or 1314.

of the Revised Code 103 which can be given effect without the invalid provision or 104 application, and to this end the provisions of Chapter 1301., 1051302., H.1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 1314.

B.

No.

195 Page 5 As Passed by the House 1302., 1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 106 1314.

107 Sec.

gender [UCC 1-1-106] 108 106] 109 In Chapters 1301., 1302., 1303., 1304., 1305., 1307., 110 1308., 1309., and 1310., and 1314.

of the Revised Code, unless 111 the statutory context otherwise requires:

112 (A) Words in the singular number include the plural, and 113 those in the plural include the singular;

and 114 (B) Words of any gender also refer to any other gender.

115 Sec.

General definitions [UCC 1-201] 116Sub. (A) Unless the context otherwise requires, words or 117 phrases defined in this section, or in the additional 118 definitions contained in Chapter 1301., 1302., 1303., 1304., 119 1305., 1307., 1308., 1309., or 1310., or 1314.

ofH. the Revised 120 Code, that apply to particular chapters or sections therein, 121 have the meanings stated.

122 (B) Subject to definitions contained in Chapter 1301., 123 1302., 1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 124 1314.

of the Revised Code, that apply to particular chapters or 125 sections therein:

126 (1) "Action", in the sense of a judicial proceeding, 127 includes recoupment, counterclaim, set-off, suit in equity, and 128 any other proceeding in which rights are determined.

129 (2) "Aggrieved party" means a party entitled to pursue a 130 remedy.

131 (3) "Agreement", as distinguished from "contract", means 132 H.

195 Page136th 6G.A. As Passed by the House the bargain of the parties in fact, as found in their language 133 or inferred from other circumstances, including course of 134 performance, course of dealing, or usage of trade as provided in 135 section 1301.303 of the Revised Code.

136(A) (4)Unless "Bank"the meanscontext aotherwise personrequires, engagedwords or phrases defined in thethis businesssection, ofor 137in bankingthe andadditional includesdefinitions acontained savingsin bank,Chapter savings1301., and1302., loan1303., 1381304., association,1305., credit1307., union,1308., and1309., trustor company.1310., or 1314.

139 (5) "Bearer" means a person in control of athe negotiableRevised 140Code, electronicthat documentapply ofto titleparticular orchapters a person in possession of a 141 negotiable instrument, negotiable tangible document of title, or 142sections certificatedtherein, securityhave thatthe ismeanings payablestated. to bearer or indorsed in 143 blank.

144(B) (6)Subject "Billto ofdefinitions lading"contained meansin aChapter document1301., of1302., title1303., evidencing1304., 1451305., the1307., receipt1308., of1309., goods for shipment issued by a person engaged in 146 the business of directly or indirectly1310., transporting or 1471314. forwarding goods.

of the Revised Code, that apply to particular chapters or sections therein:

(1) "Action", in the sense of a judicial proceeding, includes recoupment, counterclaim, set- off, suit in equity, and any other proceeding in which rights are determined.

(2) "Aggrieved party" means a party entitled to pursue a remedy.

(3) "Agreement", as distinguished from "contract", means the bargain of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in section 1301.303 of the Revised Code.

(4) "Bank" means a person engaged in the business of banking and includes a savings bank, savings and loan association, credit union, and trust company.

(5) "Bearer" means a person in control of a negotiable electronic document of title or a person in possession of a negotiable instrument, negotiable tangible document of title, or certificated security that is payable to bearer or indorsed in blank.

(6) "Bill of lading" means a document of title evidencing the receipt of goods for shipment issued by a person engaged in the business of directly or indirectly transporting or forwarding goods.

148 (7) "Branch" includes a separately incorporated foreign 149 branch of a bank.

150 (8) "Burden of establishing" a fact means the burden of 151 persuading the trier of fact that the existence of the fact is 152 more probable than its nonexistence.

153 (9) "Buyer in ordinary course of business" means a person 154 that buys goods in good faith, without knowledge that the sale 155 violates the rights of another person in the goods, and in the 156 ordinary course from a person, other than a pawnbroker, in the 157 business of selling goods of that kind.

A person buys goods in 158 the ordinary course if the sale to the person comports with the 159 usual or customary practices in the kind of business in which 160 the seller is engaged or with the seller's own usual or 161customary H.practices.

A person that sells oil, gas, or other minerals at the wellhead or minehead is a person in the business of selling goods of that kind.

A buyer in ordinary course of business may buy for cash, by exchange of other property, or on secured or unsecured credit, and may acquire goods or documents of title under a preexisting contract for sale.

Only a buyer that takes possession of the goods or has a right to recover the goods from the seller under Chapter 1302.

of the Revised Code may be a buyer in ordinary course of business.

"Buyer in ordinary course of business" does not include a person that acquires goods in a transfer in bulk or as security for or in total or partial satisfaction of a money debt.

(10) "Conspicuous", with reference to a term, means so written, displayed, or presented that, Sub.

H.

195 Page136th 7G.A. As Passed by the House customary practices.

Abased personon thatthe sellstotality oil,of gas, or other 162 minerals at the wellheadcircumstances, or minehead is a reasonable person inagainst thewhich businessit 163is ofto sellingoperate goodsought ofto thathave kind.noticed it.

AWhether buyera interm ordinaryis course"conspicuous" ofor 164not businessis may buy for cash,decision by exchangethe ofcourt. other property, or on 165 secured or unsecured credit, and may acquire goods or documents 166 of title under a preexisting contract for sale.

OnlyConspicuous aterms buyerinclude 167 that takes possession of the goodsfollowing: or has a right to recover the 168 goods from the seller under Chapter 1302.

of(a) theA Revisedheading Codein 169capitals mayequal beto aor buyergreater in ordinarysize coursethan the surrounding text, or in contrasting type, font, or color to the surrounding text of business.the same or lesser size;

"Buyerand in(b) 170Language ordinaryin coursethe body of business"a doesrecord notor includedisplay ain personlarger thattype 171than acquiresthe goodssurrounding intext, aor transfer in bulkcontrasting type, font, or ascolor securityto forthe orsurrounding intext 172of totalthe same size, or partialset satisfactionoff from surrounding text of athe moneysame debt.size by symbols or other marks that call attention to the language.

173(11) (10)"Consumer" "Conspicuous", with reference to a term, means soan 174individual written,who displayed,enters orinto presented that, based on the totality of 175 the circumstances, a reasonabletransaction personprimarily againstfor whichpersonal, itfamily, isor tohousehold 176purposes. operate ought to have noticed it.

Whether(12) a"Contract", termas isdistinguished 177from "conspicuous""agreement", ormeans notthe istotal forlegal decisionobligation bythat results from the court.parties' agreement as determined by Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

Conspicuousof 178the termsRevised includeCode theas following:supplemented by any other applicable laws.

179(13) (a)"Creditor" Aincludes headinga ingeneral capitalscreditor, equala tosecured orcreditor, greatera inlien sizecreditor, thanand 180any representative of creditors, including an assignee for the surroundingbenefit text,of orcreditors, a trustee in contrastingbankruptcy, type,a font,receiver orin colorequity, toand 181an theexecutor surroundingor textadministrator of thean sameinsolvent debtor's or lesserassignor's size;estate.

and(14) 182"Defendant" (b)includes Language in the body of a recordperson or display in larger 183 type than the surroundingposition text,of ordefendant in contrastinga type,counterclaim, font,cross- orclaim, 184 color to the surrounding text of the same size, or setthird-party offclaim. from 185 surrounding text of the same size by symbols or other marks that 186 call attention to the language.

187(15) (11)"Delivery" "Consumer"with meansrespect to an individualelectronic whodocument entersof intotitle, ameans 188voluntary transactiontransfer primarilyof forcontrol personal,and, family,with respect to an instrument, a tangible document of title, or householdan 189authoritative purposes.tangible copy of a record evidencing chattel paper, means voluntary transfer of possession.

190(16) H."Document of title" means a record (i) that in the regular course of business or financing is treated as adequately evidencing that the person in possession or control of the record is entitled to receive, control, hold, and dispose of the record and the goods the record covers and (ii) that purports to be issued by or addressed to a bailee and to cover goods in the bailee's possession which are either identified or are fungible portions of an identified mass.

The term includes a bill of lading, transport document, dock warrant, dock receipt, warehouse receipt, and order for delivery of goods.

An electronic document of title means a document of title evidenced by a record consisting of information stored in an electronic medium.

A tangible document of title means a document of title evidenced by a record consisting of information that is inscribed on a tangible medium.

(a) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.

(17) "Fault" means a default, breach, or wrongful act or omission.

(18) "Fungible goods" means:

(a) Goods of which any unit, by nature or usage of trade, is the equivalent of any other like unit;

or (b) Goods that by agreement are treated as equivalent.

Sub.

H.

195 Page136th 8G.A. As Passed by the House (12) "Contract", as distinguished from "agreement", means 191 the total legal obligation that results from the parties' 192 agreement as determined by Chapters 1301., 1302., 1303., 1304., 193 1305., 1307., 1308., 1309., and 1310., and 1314.

of(19) the"Genuine" Revisedmeans 194free Codeof asforgery supplementedor bycounterfeiting. any other applicable laws.

195(20) (13)"Good "Creditor"faith," includesexcept aas generalotherwise creditor,provided a secured 196 creditor, a lien creditor, and any representative of creditors, 197 including an assignee for the benefit of creditors, a trustee in 198Chapter bankruptcy,1305. a receiver in equity, and an executor or 199 administrator of an insolvent debtor's or assignor's estate.

200of (14)the "Defendant"Revised includesCode, ameans personhonesty in fact and the positionobservance of 201reasonable defendantcommercial instandards aof counterclaim,fair cross-claim,dealing. or third-party claim.

202(21) (15)"Holder" "Delivery"means: with respect to an electronic document of 203 title, means voluntary transfer of control and, with respect to 204 an instrument, a tangible document of title, or an authoritative 205 tangible copy of a record evidencing chattel paper, means 206 voluntary transfer of possession.

207(a) (16)The "Document of title" means a record (i) that in the 208 regular course of business or financing is treated as adequately 209 evidencing that the person in possession or control of thea 210negotiable recordinstrument that is entitledpayable toeither receive, control, hold, and dispose of the 211 record and the goods the record covers and (ii) that purports to 212bearer be issued by or addressed to aan baileeidentified andperson tothat coveris goods in the 213person bailee'sin possessionpossession; which are either identified or are fungible 214 portions of an identified mass.

(b) The termperson includesin possession of a billnegotiable tangible document of 215title lading,if transportthe document,goods dockare warrant,deliverable dockeither receipt,to 216bearer warehouseor receipt,to andthe order forof deliverythe ofperson goods.in possession;

Anor 217(c) electronicThe documentperson ofin titlecontrol, meansother athan documentpursuant ofto titledivision evidenced(G) 218of bysection a1307.106 recordof consistingthe ofRevised informationCode, storedof ina annegotiable electronic 219document medium.of title.

A(22) tangible"Insolvency documentproceeding" includes an assignment for the benefit of titlecreditors meansor aother documentproceeding intended to liquidate or rehabilitate the estate of titlethe 220person H.involved.

B.(23) "Insolvent" means:

No.(a) Having generally ceased to pay debts in the ordinary course of business other than as a result of a bona fide dispute;

195(b) PageBeing 9unable Asto Passedpay bydebts theas Housethey evidencedbecome bydue; a record consisting of information that is 221 inscribed on a tangible medium.

222or (a)(c) "Electronic"Being meansinsolvent relatingwithin tothe technologymeaning havingof 223federal electrical,bankruptcy digital,law. magnetic, wireless, optical, 224 electromagnetic, or similar capabilities.

225(24) (17)"Money" "Fault" means a default,medium breach,of exchange that is currently authorized or wrongfuladopted actby a domestic or 226foreign omission.government.

227The (18)term "Fungibleincludes goods"a means:monetary unit of account established by an intergovernmental organization or by agreement between two or more countries.

228The (a)term Goodsdoes ofnot whichinclude anyan unit,electronic byrecord naturethat oris usagea medium of trade,exchange 229recorded isand transferable in a system that existed and operated for the equivalentmedium of anyexchange otherbefore likethe unit;medium of exchange was authorized or adopted by the government.

or(25) 230"Organization" (b)means Goodsa thatperson byother agreementthan arean treatedindividual. as equivalent.

231(26) (19)"Party", "Genuine"as distinguished from "third party", means freea ofperson forgerythat has engaged in a transaction or counterfeiting.made an agreement subject to Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

232 (20) "Good faith," except as otherwise provided in Chapter 233 1305.

of the Revised Code, means honesty in fact and the 234 observance of reasonable commercial standards of fair dealing.

235 (21) "Holder" means:

236 (a) The person in possession of a negotiable instrument 237 that is payable either to bearer or to an identified person that 238 is the person in possession;

239 (b) The person in possession of a negotiable tangible 240 document of title if the goods are deliverable either to bearer 241 or to the order of the person in possession;

or 242 (c) The person in control, other than pursuant to division 243 (G) of section 1307.106 of the Revised Code, of a negotiable 244 electronic document of title.

245 (22) "Insolvency proceeding" includes an assignment for 246 the benefit of creditors or other proceeding intended to 247 H.

B.

No.

195 Page 10 As Passed by the House liquidate or rehabilitate the estate of the person involved.

248 (23) "Insolvent" means:

249 (a) Having generally ceased to pay debts in the ordinary 250 course of business other than as a result of a bona fide 251 dispute;

252 (b) Being unable to pay debts as they become due;

or 253 (c) Being insolvent within the meaning of federal 254 bankruptcy law.

255 (24) "Money" means a medium of exchange that is currently 256 authorized or adopted by a domestic or foreign government.

The 257 term includes a monetary unit of account established by an 258 intergovernmental organization or by agreement between two or 259 more countries.

The term does not include an electronic record 260 that is a medium of exchange recorded and transferable in a 261 system that existed and operated for the medium of exchange 262 before the medium of exchange was authorized or adopted by the 263 government.

264 (25) "Organization" means a person other than an 265 individual.

266 (26) "Party", as distinguished from "third party", means a 267 person that has engaged in a transaction or made an agreement 268 subject to Chapters 1301., 1302., 1303., 1304., 1305., 1307., 269 1308., 1309., and 1310., and 1314.

270 (27) "Person" means an individual, corporation, business 271 trust, estate, trust, partnership, limited liability company, 272 association, joint venture, government, governmental 273 subdivision, agency, or instrumentality, public corporation, or 274 any other legal or commercial entity.

The term includes a 275protected H.series, however denominated, of an entity if the protected series is established under law other than Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., 1310., and 1314.

of the Revised Code, that limits, or limits if conditions specified under the law are satisfied, the ability of a creditor of the entity or of any other protected series of the entity to satisfy a claim from assets of the protected series.

(28) "Present value" means the amount as of a date certain of one or more sums payable in the future, discounted to the date certain by use of either an interest rate specified by the parties if that rate is not manifestly unreasonable at the time the transaction is entered into or, if an interest Sub.

H.

195 Page136th 11G.A. As Passed by the House protected series, however denominated, of an entity if the 276 protected series is established under law other than Chapters 277 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., 1310., 278 and 1314.

ofrate theis Revisednot Code,so thatspecified, limits,a orcommercially limitsreasonable ifrate 279that conditionstakes specifiedinto underaccount the lawfacts areand satisfied,circumstances theat ability of 280 a creditor of the entitytime or of any other protected series of the 281transaction entityis toentered satisfyinto. a claim from assets of the protected series.

282(29) (28)"Purchase" "Present value" means thetaking amount as of a date certain 283 of one or more sums payable in the future, discounted to the 284 date certain by usesale, oflease, eitherdiscount, annegotiation, interestmortgage, ratepledge, specifiedlien, bysecurity theinterest, 285issue partiesor ifreissue, thatgift, rateor isany notother manifestlyvoluntary unreasonable at the time 286 the transaction iscreating entered into or, if an interest ratein isproperty. not 287 so specified, a commercially reasonable rate that takes into 288 account the facts and circumstances at the time the transaction 289 is entered into.

290(30) (29)"Purchaser" "Purchase" means takinga byperson sale,that lease,takes discount,by 291purchase. negotiation, mortgage, pledge, lien, security interest, issue or 292 reissue, gift, or any other voluntary transaction creating an 293 interest in property.

294(31) (30)"Record" "Purchaser" means information that is inscribed on a persontangible medium or that takesis bystored purchase.in an electronic or other medium and is retrievable in perceivable form.

295(32) (31)"Remedy" "Record" means informationany thatremedial isright inscribedto onwhich aan 296aggrieved tangibleparty medium or that is storedentitled inwith an electronic or otherwithout 297resort mediumto anda istribunal. retrievable in perceivable form.

298(33) (32)"Representative" "Remedy" means anya remedialperson rightempowered to whichact for another, including an 299agent, aggrievedan partyofficer isof entitleda withcorporation or withoutassociation, resortand to a 300trustee, tribunal.executor, or administrator of an estate.

301(34) (33)"Right" "Representative"includes meansremedy. a person empowered to act for 302 another, including an agent, an officer of a corporation or 303 association, and a trustee, executor, or administrator of an 304 H.

B.(35) "Security interest" means an interest in personal property or fixtures which secures payment or performance of an obligation.

No."Security interest" includes any interest of a consignor and a buyer of accounts, chattel paper, a payment intangible, or a promissory note in a transaction that is subject to Chapter 1309.

195 Page 12 As Passed by the House estate.

305 (34) "Right" includes remedy.

306 (35) "Security interest" means an interest in personal 307 property or fixtures which secures payment or performance of an 308 obligation.

"Security interest" includes any interest of a 309 consignor and a buyer of accounts, chattel paper, a payment 310 intangible, or a promissory note in a transaction that is 311 subject to Chapter 1309.

"Security 312 interest" does not include the special property interest of a 313 buyer of goods on identification of those goods to a contract 314 for sale under section 1302.42 of the Revised Code, but a buyer 315 may also acquire a "security interest" by complying with Chapter 316 1309.

Except as otherwise provided in 317 section 1302.49 of the Revised Code, the right of a seller or 318 lessor of goods under Chapter 1302.

of the Revised Code 319 to retain or acquire possession of the goods is not a "security 320 interest", but a seller or lessor may also acquire a "security 321 interest" by complying with Chapter 1309.

322 The retention or reservation of title by a seller of goods 323 notwithstanding shipment or delivery to the buyer under section 324 1302.42 of the Revised Code is limited in effect to a 325 reservation of a "security interest." Whether a transaction in 326 the form of a lease creates a "security interest" is determined 327 pursuant to section 1301.203 of the Revised Code.

328 (36) "Send" in connection with any writing, record, or 329 notice notification means:

330 (a) To deposit in the mail or , deliver for transmission, 331 or transmit by any other usual means of communication with 332 postage or cost of transmission provided for, and properly 333 addressed and, in the case of an instrument, to an address 334specified H.thereon or otherwise agreed, or if there be none addressed to any address reasonable under the circumstances;

or (b) In any other way to cause to be received any record or notice within the time it would have arrived if properly sentTo cause the record or notification to be received within the time it would have been received if properly sent under division (B)(36)(a) of this section.

(37) "Signed" includes using any symbol executed or adopted with present intention to adopt or accept a writing"Sign," "signing," and "signature" mean, with present intent to authenticate or adopt a record, to do either of the following:

Sub.

H.

195 Page136th 13G.A. As Passed by the House specified thereon or otherwise agreed, or if there be none 335 addressed to any address reasonable under the circumstances;

or(a) 336Execute (b) In any other way to cause to be received any record or 337adopt noticea withintangible thesymbol; time it would have arrived if properly sentTo 338 cause the record or notification to be received within the time 339 it would have been received if properly sent under division (B) 340 (36)(a) of this section.

341(b) (37)Attach "Signed" includes using any symbol executed or 342 adopted with present intention to adopt or acceptlogically aassociate 343 writing"Sign," "signing," and "signature" mean, with presentthe 344record intentan toelectronic authenticatesymbol, sound, or adoptprocess. a record, to do either of the 345 following:

346(38) (a)"State" Executemeans a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or adoptany aterritory tangibleor symbol;insular possession subject to the jurisdiction of the United States.

347(39) (b)"Surety" Attachincludes toa guarantor or logicallyany associateother withsecondary theobligor. record an 348 electronic symbol, sound, or process.

349(40) (38)"Term" "State" means a stateportion of thean Unitedagreement States,that therelates 350 District of Columbia, Puerto Rico, the United States Virgin 351 Islands, or any territory or insular possession subject to thea 352particular jurisdictionmatter. of the United States.

353(41) (39)"Unauthorized "Surety"signature" includesmeans a guarantorsignature ormade anywithout otheractual, secondaryimplied, 354or obligor.apparent authority.

355The (40)term "Term"includes means a portionforgery. of an agreement that relates 356 to a particular matter.

357(42) (41)"Warehouse "Unauthorizedreceipt" signature" means a signaturedocument madeof 358title withoutissued actual,by implied,a orperson apparentengaged authority.in the business of storing goods for hire.

The(43) term"Writing" 359 includes aprinting, forgery.typewriting, or any other intentional reduction to tangible form.

360"Written" (42)has "Warehouse receipt" means a documentcorresponding ofmeaning. title issued 361 by a person engaged in the business of storing goods for hire.

362Sec. H.

B.

No.

195 Page 14 As Passed by the House (43) "Writing" includes printing, typewriting, or any 363 other intentional reduction to tangible form.

"Written" has a 364 corresponding meaning.

365 Sec.

Value [UCC 1-204] 366 Except as otherwise provided in Chapters 1303., 1304., and 367 1305., and 1314.

of the Revised Code, a person gives value for 368 rights if the person acquires them:

369 (A) In return for a binding commitment to extend credit or 370 for the extension of immediately available credit, whether or 371 not drawn upon and whether or not a charge-back is provided for 372 in the event of difficulties in collection;

373 (B) As security for, or in total or partial satisfaction 374 of, a preexisting claim;

375 (C) By accepting delivery under a preexisting contract for 376 purchase;

or 377 (D) In return for any consideration sufficient to support 378 a simple contract.

379 Sec.

Seasonableness [UCC 1-205] 380 (A) Whether a time for taking an action required by 381 Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., 382 and 1310., and 1314.

of the Revised Code is reasonable depends 383 on the nature, purpose, and circumstances of the action.

384 (B) An action is taken seasonably if it is taken at or 385 within the time agreed or, if no time is agreed, at or within a 386 reasonable time.

387 Sec.

Presumptions [UCC 1-206] 388 Whenever Chapter 1301., 1302., 1303., 1304., 1305., 1307., 3891308., H.1309., or 1310., or 1314.

B.of the Revised Code creates a "presumption" with respect to a fact, or provides that a fact is "presumed," the trier of fact must find the existence of the fact unless and until evidence is introduced that supports a finding of its nonexistence.

No.Sec.

195 Page 15 As Passed by the House 1308., 1309., or 1310., or 1314.

of the Revised Code creates a 390 "presumption" with respect to a fact, or provides that a fact is 391 "presumed," the trier of fact must find the existence of the 392 fact unless and until evidence is introduced that supports a 393 finding of its nonexistence.

394 Sec.

parties' power 395 to choose applicable law [UCC 1-301]1- 396301] (A) Except as otherwise provided in this section, when a 397 transaction bears a reasonable relation to this state and also 398 to another state or nation the parties may agree that the law 399 either of this state or of such other state or nation shall 400 govern their rights and duties.

401Sub. (B) In the absence of an agreement effective under 402 division (A) of this section, and except as provided in division 403 (C) of this section, Chapters 1301., 1302., 1303., 1304., 1305., 404 1307., 1308., 1309., and 1310., and 1314.

ofH. the Revised Code 405 apply to transactions bearing an appropriate relation to this 406 state.

407 (C) If one of the following provisions of Chapters 1301., 408 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 409 1314.

of the Revised Code specifies the applicable law, that 410 provision governs and a contrary agreement is effective only to 411 the extent permitted by the law so specified:

412 (1) Section 1302.43 of the Revised Code;

413 (2) Sections 1310.03 and 1310.04 of the Revised Code;

414 (3) Section 1304.02 of the Revised Code;

415 (4) Section 1304.85 of the Revised Code;

416 (5) Section 1305.15 of the Revised Code;

417 H.

195 Page136th 16G.A. As Passed by the House (6) Section 1308.05 of the Revised Code;

418(B) (7)In Sectionsthe 1309.301absence toof 1309.307an agreement effective under division (A) of thethis Revisedsection, Code;and except as provided in division (C) of this section, Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

419of (8)the SectionRevised 1314.107Code ofapply theto Revisedtransactions Code.bearing an appropriate relation to this state.

420(C) Sec.If one of the following provisions of Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

of the Revised Code specifies the applicable law, that provision governs and a contrary agreement is effective only to the extent permitted by the law so specified:

(1) Section 1302.43 of the Revised Code;

(2) Sections 1310.03 and 1310.04 of the Revised Code;

(3) Section 1304.02 of the Revised Code;

(4) Section 1304.85 of the Revised Code;

(5) Section 1305.15 of the Revised Code;

(6) Section 1308.05 of the Revised Code;

(7) Sections 1309.301 to 1309.307 of the Revised Code;

(8) Section 1314.107 of the Revised Code.

Sec.

Variation by agreement [UCC 1-302] 421 (A) Except as otherwise provided in division (B) of this 422 section or elsewhere in Chapter 1301., 1303., 1304., 1305., 423 1307., 1308., 1309., or 1310., or 1314.

of the Revised Code, the 424 effect of provisions of Chapters 1301., 1303., 1304., 1305., 425 1307., 1308., 1309., and 1310., and 1314.

of the Revised Code 426 may be varied by agreement.

427 (B) The obligations of good faith, diligence, 428 reasonableness, and care prescribed by Chapter 1301., 1302., 429 1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 1314.

of 430 the Revised Code may not be disclaimed by agreement.

The 431 parties, by agreement, may determine the standards by which the 432 performance of those obligations is to be measured if those 433 standards are not manifestly unreasonable.

Whenever Chapter 434 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., or 435 1310., or 1314.

of the Revised Code requires an action to be 436 taken within a reasonable time, a time that is not manifestly 437 unreasonable may be fixed by agreement.

438 (C) The presence in certain provisions of Chapter 1301., 439 1302., 1303., 1304., 1305., 1307., 1308., 1309., or 1310., or 440 1314.

of the Revised Code of the phrase "unless otherwise 441 agreed", or words of similar import, does not imply that the 442 effect of other provisions may not be varied by agreement under 443 this section.

444 Sec.

Obligation of good faith [UCC 1-304] 445Every H.contract or duty within Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

of the Revised Code imposes an obligation of good faith in its performance and enforcement.

Sec.

1301.305.

Remedies to be liberally administered [UCC 1-305] (A) The remedies provided by Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

of the Revised Code must be liberally administered to the end that the Sub.

H.

195 Page136th 17G.A. As Passed by the House Every contract or duty within Chapters 1301., 1302., 446 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

447aggrieved ofparty may be put in as good a position as if the Revisedother Codeparty imposeshad anfully obligationperformed ofbut goodneither faithconsequential or special damages nor penal damages may be had except as specifically provided in itsthose 448chapters performanceor andby enforcement.other rule of law.

449(B) Sec.Any right or obligation declared by Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

1301.305.of the Revised Code is enforceable by action unless the provision declaring it specifies a different and limited effect.

RemediesSec. to be liberally administered [UCC 450 1-305] 451 (A) The remedies provided by Chapters 1301., 1302., 1303., 452 1304., 1305., 1307., 1308., 1309., and 1310., and 1314.

of the 453 Revised Code must be liberally administered to the end that the 454 aggrieved party may be put in as good a position as if the other 455 party had fully performed but neither consequential or special 456 damages nor penal damages may be had except as specifically 457 provided in those chapters or by other rule of law.

458 (B) Any right or obligation declared by Chapters 1301., 459 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310., and 460 1314.

of the Revised Code is enforceable by action unless the 461 provision declaring it specifies a different and limited effect.

462 Sec.

Waiver or renunciation of claim or right 463 after breach [UCC 1-306] 464 A claim or right arising out of an alleged breach may be 465 discharged in whole or in part without consideration by 466 agreement of the aggrieved party in an authenticated a signed 467 record.

468 Sec.

Definitions [UCC 2-103 to 2-106] 469 (A) As used in sections 1302.01 to 1302.98 of the Revised 470 Code, unless the context otherwise requires:

471 (1) "Buyer" means a person who buys or contracts to buy 472 goods.

473(2) H."Good faith" has the same meaning as in section 1301.201 of the Revised Code.

(3) "Receipt" of goods means taking physical possession of them.

(4) "Seller" means a person who sells or contracts to sell goods.

(5) "Merchant" means a person who deals in goods of the kind or otherwise by the person's occupation holds the person out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by the person's employment of an agent or broker or other intermediary who by the agent's, broker's, or other intermediary's occupation holds the person out as having such knowledge or skill.

(6) "Financing agency" means a bank, finance company, or other person who in the ordinary course of business make advances against goods or documents of title or who by arrangement with either the seller or the buyer intervenes in ordinary course to make or collect payment due or claimed under the contract for sale, as by purchasing or paying the seller's draft or making advances against it or by merely taking it for collection whether or not documents of title accompany or are associated with the draft.

"Financing agency" includes also a bank or other person who similarly intervenes between persons who are in the position of seller and buyer in respect to the goods under section 1302.81 of the Revised Code.

(7) "Between merchants" means in any transaction with respect to which both parties are chargeable with the knowledge or skill of merchants.

(8) "Goods" means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities, and things in action.

"Goods" also includes the unborn young of animals and growing crops and other identified things attached to realty as described in section 1302.03 of the Revised Code.

Goods must be both existing and identified before any interest in them can pass.

Goods which are not both existing and identified are "Future" goods.

A purported present sale of future Sub.

H.

195 Page136th 18G.A. As Passed by the House (2) "Good faith" has the same meaning as in section 474 1301.201 of the Revised Code.

475goods (3)or "Receipt" of goodsany meansinterest takingtherein physicaloperates possessionas ofa 476contract them.to sell.

477There (4)may "Seller"be means a personsale whoof sellsa orpart contractsinterest toin sellexisting 478identified goods.

479An (5)undivided "Merchant"share meansin aan personidentified whobulk deals in goods of thefungible 480 kind or otherwise by the person's occupation holds the person 481 out as having knowledge or skill peculiar to the practices or 482 goods involvedis insufficiently theidentified transaction or to whom such knowledge or 483 skill may be attributedsold byalthough the person'squantity employment of an agent 484 or broker or other intermediary who by the agent's,bulk broker's,is ornot 485determined. other intermediary's occupation holds the person out as having 486 such knowledge or skill.

487Any (6)agreed "Financingproportion agency"of meanssuch a bank,bulk finance company, or 488any otherquantity personthereof whoagreed inupon theby ordinarynumber, courseweight, of business make 489 advances against goods or documentsother ofmeasure titlemay orto who by 490 arrangement with either the sellerextent orof the buyerseller's intervenesinterest in 491 ordinary course to make or collect payment due or claimed under 492 the contractbulk forbe sale,sold asto by purchasing or paying the seller'sbuyer 493who draftthen orbecomes makingan advancesowner againstin itcommon. or by merely taking it for 494 collection whether or not documents of title accompany or are 495 associated with the draft.

"Financing(9) agency""Lot" includesmeans also a 496parcel bank or othera personsingle whoarticle similarlywhich intervenesis between persons 497 who are in the positionsubject matter of sellera andseparate buyersale inor respectdelivery, towhether theor 498not goodsit underis sectionsufficient 1302.81to ofperform the Revisedcontract. Code.

499(10) (7)"Commercial "Betweenunit" merchants" means insuch anya transactionunit withof 500goods respectas toby whichcommercial bothusage partiesis area chargeablesingle withwhole thefor knowledgepurposes 501of orsale skilland division of merchants.which materially impairs its character or value on the market or in use.

502A H.commercial unit may be a single article (as a machine) or a set of articles (as a suite of furniture or an assortment of sizes) or a quantity (as a bale, gross, or carload) or any other unit treated in use or in the relevant market as a single whole.

(11) "Contract" and "agreement" are limited to those relating to the present or future sale of goods.

"Contract for sale" includes both a present sale of goods and a contract to sell goods at a future time.

A "sale" consists in the passing of title from the seller to the buyer for a price.

A "present sale" means a sale which is accomplished by the making of the contract.

(12) Goods or conduct including any part of a performance are "conforming" or conform to the contract when they are in accordance with the obligations under the contract.

(13) "Termination" occurs when either party pursuant to a power created by agreement or law puts an end to the contract otherwise than for its breach.

On "termination" all obligations which are still executory on both sides are discharged but any right based on prior breach or performance survives.

(14) "Cancellation" occurs when either party puts an end to the contract for breach by the other and its effect is the same as that of "termination" except that the cancelling party also retains any remedy for breach of the whole contract or any unperformed balance.

(15) "Hybrid transaction" means a single transaction involving a sale of goods and any of the following:

(a) The provision of services;

(b) A lease of other goods;

(c) A sale, lease, or license of property other than goods.

(B) Other definitions applying to sections 1302.01 to 1302.98 of the Revised Code are:

(1) "Acceptance", as defined in section 1302.64 of the Revised Code;

(2) "Banker's credit", as defined in section 1302.38 of the Revised Code;

(3) "Confirmed credit", as defined in section 1302.38 of the Revised Code;

(4) "Cover", as defined in section 1302.86 of the Revised Code;

(5) "Entrusting", as defined in section 1302.44 of the Revised Code;

(6) "Identification", as defined in section 1302.45 of the Revised Code;

Sub.

H.

195 Page136th 19G.A. As Passed by the House (8) "Goods" means all things (including specially 503 manufactured goods) which are movable at the time of 504 identification to the contract for sale other than the money in 505 which the price is to be paid, investment securities, and things 506 in action.

"Goods"(7) also"Installment includescontract", the unborn young of animals and 507 growing crops and other identified things attached to realty as 508defined described in section 1302.031302.70 of the Revised Code.Code;

509(8) Goods"Letter mustof becredit", bothas existingdefined andin identifiedsection before1302.38 anyof 510the interestRevised inCode; them can pass.

Goods(9) which"Overseas", areas notdefined bothin existingsection and1302.36 511of identifiedthe areRevised "Future"Code; goods.

A(10) purported"Person presentin saleposition of 512a futureseller", goodsas ordefined ofin anysection interest1302.81 thereinof operatesthe asRevised aCode; contract 513 to sell.

514(11) There"Sale mayon beapproval", aas saledefined ofin asection part1302.39 interestof inthe existingRevised 515Code; identified goods.

516(12) An"Sale undividedor sharereturn", inas andefined identifiedin bulksection of1302.39 fungible goods 517 is sufficiently identified to be sold although the quantity of 518 the bulkRevised isCode. not determined.

Any(C) agreedAs proportionused in sections 1302.01 to 1302.98 of suchthe aRevised bulkCode, 519"check" orand any"draft" quantityhave thereofthe agreedmeaning uponset byforth number,in weight,section or1303.03 otherof 520the measureRevised mayCode, to"consignee" and "consignor" have the extentmeaning set forth in section 1307.102 of the seller'sRevised interestCode, "consumer goods" has the meaning set forth in section 1309.102 of the bulkRevised 521Code, be"control" soldhas tothe same meaning as set forth in section 1307.106 of the buyerRevised whoCode, thenand becomes"dishonor" anhas ownerthe meaning set forth in common.section 1303.62 of the Revised Code.

522(D) (9)In "Lot"addition, meansChapter a1301. parcel or a single article which is the 523 subject matter of a separate sale or delivery, whether or not it 524 is sufficient to perform the contract.

525 (10) "Commercial unit" means such a unit of goodsthe asRevised byCode 526contains commercialgeneral usagedefinitions isand aprinciples single whole for purposes of saleconstruction and 527interpretation divisionapplicable ofthroughout whichthis materiallychapter. impairs its character or value on 528 the market or in use.

ASec. commercial unit may be a single article 529 (as a machine) or a set of articles (as a suite of furniture or 530 an assortment of sizes) or a quantity (as a bale, gross, or 531 H.

B.

No.

195 Page 20 As Passed by the House carload) or any other unit treated in use or in the relevant 532 market as a single whole.

533 (11) "Contract" and "agreement" are limited to those 534 relating to the present or future sale of goods.

"Contract for 535 sale" includes both a present sale of goods and a contract to 536 sell goods at a future time.

A "sale" consists in the passing of 537 title from the seller to the buyer for a price.

A "present sale" 538 means a sale which is accomplished by the making of the 539 contract.

540 (12) Goods or conduct including any part of a performance 541 are "conforming" or conform to the contract when they are in 542 accordance with the obligations under the contract.

543 (13) "Termination" occurs when either party pursuant to a 544 power created by agreement or law puts an end to the contract 545 otherwise than for its breach.

On "termination" all obligations 546 which are still executory on both sides are discharged but any 547 right based on prior breach or performance survives.

548 (14) "Cancellation" occurs when either party puts an end 549 to the contract for breach by the other and its effect is the 550 same as that of "termination" except that the cancelling party 551 also retains any remedy for breach of the whole contract or any 552 unperformed balance.

553 (15) "Hybrid transaction" means a single transaction 554 involving a sale of goods and any of the following:

555 (a) The provision of services;

556 (b) A lease of other goods;

557 (c) A sale, lease, or license of property other than 558 goods.

559 H.

B.

No.

195 Page 21 As Passed by the House (B) Other definitions applying to sections 1302.01 to 560 1302.98 of the Revised Code are:

561 (1) "Acceptance", as defined in section 1302.64 of the 562 Revised Code;

563 (2) "Banker's credit", as defined in section 1302.38 of 564 the Revised Code;

565 (3) "Confirmed credit", as defined in section 1302.38 of 566 the Revised Code;

567 (4) "Cover", as defined in section 1302.86 of the Revised 568 Code;

569 (5) "Entrusting", as defined in section 1302.44 of the 570 Revised Code;

571 (6) "Identification", as defined in section 1302.45 of the 572 Revised Code;

573 (7) "Installment contract", as defined in section 1302.70 574 of the Revised Code;

575 (8) "Letter of credit", as defined in section 1302.38 of 576 the Revised Code;

577 (9) "Overseas", as defined in section 1302.36 of the 578 Revised Code;

579 (10) "Person in position of a seller", as defined in 580 section 1302.81 of the Revised Code;

581 (11) "Sale on approval", as defined in section 1302.39 of 582 the Revised Code;

583 (12) "Sale or return", as defined in section 1302.39 of 584 the Revised Code.

585 H.

B.

No.

195 Page 22 As Passed by the House (C) As used in sections 1302.01 to 1302.98 of the Revised 586 Code, "check" and "draft" have the meaning set forth in section 587 1303.03 of the Revised Code, "consignee" and "consignor" have 588 the meaning set forth in section 1307.102 of the Revised Code, 589 "consumer goods" has the meaning set forth in section 1309.102 590 of the Revised Code, "control" has the same meaning as set forth 591 in section 1307.106 of the Revised Code, and "dishonor" has the 592 meaning set forth in section 1303.62 of the Revised Code.

593 (D) In addition, Chapter 1301.

of the Revised Code 594 contains general definitions and principles of construction and 595 interpretation applicable throughout this chapter.

596 Sec.

certain security and other 597 transactions excluded [UCC 2-102] 598 (A) Unless the context otherwise requires, and except as 599 provided in division (C) of this section, sections 1302.01 to 600 1302.98, inclusive, of the Revised Code, apply to transactions 601 in goods;

they do not apply to any transaction which although in 602 the form of an unconditional contract to sell or present sale is 603 intended to operate only as a security transaction nor do 604 sections 1302.01 to 1302.98, inclusive, of the Revised Code 605 impair or repeal any statute regulating sales to consumers, 606 farmers, or other specified classes of buyers and, in the case 607 of a hybrid transaction, it applies to the extent provided under 608 division (B) of this section.

609 (B) In a hybrid transaction:

610 (1) If the sale-of-goods aspects do not predominate, only 611 the provisions of sections 1302.01 to 1302.98 of the Revised 612 Code which relate primarily to the sale-of-goods aspects of the 613 transactions apply, and the provisions that relate primarily to 614the H.transaction as a whole do not apply.

B.(2) If the sale-of-goods aspects predominate, sections 1302.01 to 1302.98 of the Revised Code apply but do not preclude application in the appropriate circumstances of other law to aspects of the transaction which do not relate to the sale of goods.

No.(C) Sections 1302.01 to 1302.98 of the Revised Code do not:

195(1) PageApply 23to Asa Passedtransaction bythat, theeven Housethough in the transactionform asof aan wholeunconditional docontract notto apply.sell or present sale, operates only to create a security interest;

615 (2) IfImpair theor sale-of-goodsrepeal aspectsa predominate,statute sectionsregulating 616sales 1302.01 to 1302.98consumers, offarmers, theor Revised Code apply but do not preclude 617 application in the appropriate circumstances of other lawspecified toclasses 618 aspects of thebuyers. transaction which do not relate to the sale of 619 goods.

620Sec. (C) Sections 1302.01 to 1302.98 of the Revised Code do 621 not:

622 (1) Apply to a transaction that, even though in the form 623 of an unconditional contract to sell or present sale, operates 624 only to create a security interest;

625 (2) Impair or repeal a statute regulating sales to 626 consumers, farmers, or other specified classes of buyers.

627 Sec.

statute of frauds [UCC-[UCC-2-201] 628 2-201] 629 (A) Except as otherwise provided in this section, a 630 contract for the sale of goods for the price of five hundred 631 dollars or more is not enforceable by way of action or defense 632 unless there is some writing a record sufficient to indicate 633 that a contract for sale has been made between the parties and 634Sub. signed by the party against whom enforcement is sought or by 635 histhe party's authorized agent or broker .

AH. writing record is 636 not insufficient because it omits or incorrectly states a term 637 agreed upon but the contract is not enforceable under this 638 division beyond the quantity of goods shown in such writingthe 639 record.

640 (B) Between merchants if within a reasonable time a 641 writing record in confirmation of the contract and sufficient 642 against the sender is received and the party receiving it has 643 H.

195 Page136th 24G.A. As Passed by the House reason to know its contents, it satisfies the requirements of 644 division (A) of this section against such the party unless 645 written notice in a record of objection to its contents is given 646 within ten days after it is received.

647signed (C)by A contract which does not satisfy the requirementsparty ofagainst 648whom divisionenforcement (A)is ofsought thisor sectionby buthisthe whichparty's isauthorized validagent inor otherbroker 649. respects is enforceable:

650A (1)writing ifrecord theis goods are to be specially manufactured for the 651 buyer and are not suitableinsufficient forbecause saleit toomits othersor inincorrectly thestates ordinarya 652term courseagreed ofupon thebut seller's business and the seller,contract before notice of 653 repudiation is receivednot andenforceable under circumstancesthis whichdivision reasonablybeyond 654 indicate that the goodsquantity are for the buyer, has made either a 655 substantial beginning of theirgoods manufactureshown orin commitmentssuch forwritingthe 656record. their procurement;

or(B) 657Between (2)merchants if within a reasonable time a writing record in confirmation of the partycontract and sufficient against whomthe enforcementsender is soughtreceived admitsand 658the inparty histhereceiving party'sit pleading,has testimony,reason orto otherwiseknow inits courtcontents, 659it thatsatisfies athe contractrequirements forof saledivision was(A) made,of butthis section against such the contractparty isunless notwritten 660notice enforceablein undera thisrecord provisionof beyondobjection theto quantityits ofcontents goodsis 661given admitted;within ten days after it is received.

or(C) 662A (3)contract withwhich respectdoes tonot goodssatisfy forthe whichrequirements paymentof hasdivision been(A) madeof 663this andsection acceptedbut or which haveis beenvalid received and accepted in 664other accordancerespects withis sectionenforceable: 1302.64 of the Revised Code.

665(1) Sec.if the goods are to be specially manufactured for the buyer and are not suitable for sale to others in the ordinary course of the seller's business and the seller, before notice of repudiation is received and under circumstances which reasonably indicate that the goods are for the buyer, has made either a substantial beginning of their manufacture or commitments for their procurement;

or (2) if the party against whom enforcement is sought admits in histhe party's pleading, testimony, or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted;

or (3) with respect to goods for which payment has been made and accepted or which have been received and accepted in accordance with section 1302.64 of the Revised Code.

Sec.

parol or extrinsic 666 evidence [UCC 2-202] 667 Terms with respect to which the confirmatory memoranda of 668 the parties agree or which are otherwise set forth in a writing 669 record intended by the parties as a final expression of their 670 agreement with respect to such terms as are included therein may 671 not be contradicted by evidence of any prior agreement or of a 672contemporaneous H.oral agreement but may be explained or supplemented:

B.(A) by course of performance, course of dealing, or usage of trade as provided in section 1301.303 of the Revised Code;

No.and (B) by evidence of consistent additional terms unless the court finds the writing record to have been intended also as a complete and exclusive statement of the terms of the agreement.

195Sec. Page 25 As Passed by the House contemporaneous oral agreement but may be explained or 673 supplemented:

674 (A) by course of performance, course of dealing, or usage 675 of trade as provided in section 1301.303 of the Revised Code;

676 and 677 (B) by evidence of consistent additional terms unless the 678 court finds the writing record to have been intended also as a 679 complete and exclusive statement of the terms of the agreement.

680 Sec.

Seals inoperative [UCC 2-203] 681 The affixing of a seal to a writing record evidencing a 682 contract for sale or an offer to buy or sell goods does not 683 constitute the writing record a sealed instrument and the law 684 with respect to sealed instruments does not apply to such a 685 contract or offer.

686 Sec.

Firm offers [UCC 2-205] 687 An offer by a merchant to buy or sell goods in a signed 688 writing record which by its terms gives assurance that it will 689 be held open is not revocable, for lack of consideration, during 690 the time stated or if no time is stated for a reasonable time, 691 but in no event may such period of irrevocability exceed three 692 months;

but any such term of assurance on a form supplied by the 693 offeree must be separately signed by the offeror.

694Sub. Sec.

1302.12.H.

Modification, rescission, and waiver [UCC 2- 695 209] 696 (A) An agreement modifying a contract within sections 697 1302.01 to 1302.98, inclusive, of the Revised Code, needs no 698 consideration to be binding.

699 (B) A signed agreement which excludes modification or 700 H.

195 Page136th 26G.A. As Passed by the House rescission except by a signed writing or other signed record 701 cannot be otherwise modified or rescinded, but except as between 702 merchants such a requirement on a form supplied by the merchant 703 must be separately signed by the other party.

704Sec. (C) The requirements of section 1302.04 of the Revised 705 Code, must be satisfied if the contract as modified is within 706 its provisions.

7071302.12. (D) Although an attempt at modification or rescission does 708 not satisfy the requirements of division (B) or (C) of this 709 section, it can operate as a waiver.

710Modification, (E)rescission, Aand party who has made a waiver affecting[UCC an2-209] executory(A) 711An portionagreement ofmodifying thea contract maywithin retractsections the1302.01 waiverto by1302.98, reasonableinclusive, 712of notification received by the otherRevised partyCode, thatneeds strictno performanceconsideration 713to will be requiredbinding. of any term waived, unless the retraction would 714 be unjust in view of a material change of position in reliance 715 on the waiver.

716(B) Sec.A signed agreement which excludes modification or rescission except by a signed writing or other signed record cannot be otherwise modified or rescinded, but except as between merchants such a requirement on a form supplied by the merchant must be separately signed by the other party.

(C) The requirements of section 1302.04 of the Revised Code, must be satisfied if the contract as modified is within its provisions.

(D) Although an attempt at modification or rescission does not satisfy the requirements of division (B) or (C) of this section, it can operate as a waiver.

(E) A party who has made a waiver affecting an executory portion of the contract may retract the waiver by reasonable notification received by the other party that strict performance will be required of any term waived, unless the retraction would be unjust in view of a material change of position in reliance on the waiver.

Sec.

Definitions [UCC 3-103] 717 (A) As used in this chapter, unless the context otherwise 718 requires:

719 (1) "Acceptor" means a drawee who has accepted a draft.

720 (2) "Consumer account" means an account established by an 721 individual primarily for personal, family, or household 722 purposes.

723 (3) "Consumer transaction" means a transaction in which an 724 individual incurs an obligation primarily for personal, family, 725 or household purposes.

726 (4) "Drawee" means a person ordered in a draft to make 727 payment.

728(5) H."Drawer" means a person who signs or is identified in a draft as a person ordering payment.

(6) "Good faith" has the same meaning as in section 1301.201 of the Revised Code.

(7) "Issue" means either of the following:

(a) The first delivery of an instrument by the maker or drawer to a holder or nonholder for the purpose of giving rights of the instrument to any person;

(b) If agreed by the payee, the first transmission by the drawer to the payee of an image of an item and information derived from the item that enables the depositary bank to collect the item by transferring or presenting under federal law an electronic check.

(8) "Issuer" means a maker or drawer of an issued or unissued instrument.

(9) "Maker" means a person who signs or is identified in a note as a person undertaking to pay.

(10) "Order" means a written instruction to pay money signed by the person giving the instruction.

The instruction may be addressed to any person, including the person giving the instruction, or to one or more persons jointly or in the alternative but not in succession.

"Order" does Sub.

H.

195 Page136th 27G.A. As Passed by the House (5) "Drawer" means a person who signs or is identified in 729 a draft as a person ordering payment.

730not (6)mean "Goodan faith"authorization hasto thepay sameunless meaningthe asperson inauthorized sectionto 731pay 1301.201also ofis theinstructed Revisedto Code.pay.

732(11) (7)"Ordinary "Issue"care" in the case of a person engaged in business means eitherobservance of the following:reasonable commercial standards that are prevailing in the area in which the person is located with respect to the business in which the person is engaged.

733In (a)the Thecase firstof deliverya ofbank that takes an instrument byfor theprocessing makerfor collection or 734payment drawerby toautomated ameans, holderreasonable orcommercial nonholderstandards fordo not require the purposebank ofto givingexamine rightsthe 735instrument ofif the instrumentfailure to anyexamine person;does not violate the bank's prescribed procedures, and the bank's procedures do not vary unreasonably from general banking usage not disapproved by this chapter or Chapter 1304.

736 (b) If agreed by the payee, the first transmission by the 737 drawer to the payee of an image of an item and information 738 derived from the item that enables the depositary bank to 739 collect the item by transferring or presenting under federal law 740 an electronic check.

741 (8) "Issuer" means a maker or drawer of an issued or 742 unissued instrument.

743 (9) "Maker" means a person who signs or is identified in a 744 note as a person undertaking to pay.

745 (10) "Order" means a written instruction to pay money 746 signed by the person giving the instruction.

The instruction may 747 be addressed to any person, including the person giving the 748 instruction, or to one or more persons jointly or in the 749 alternative but not in succession.

"Order" does not mean an 750 authorization to pay unless the person authorized to pay also is 751 instructed to pay.

752 (11) "Ordinary care" in the case of a person engaged in 753 business means observance of the reasonable commercial standards 754 that are prevailing in the area in which the person is located 755 with respect to the business in which the person is engaged.

In 756 H.

B.

No.

195 Page 28 As Passed by the House the case of a bank that takes an instrument for processing for 757 collection or payment by automated means, reasonable commercial 758 standards do not require the bank to examine the instrument if 759 the failure to examine does not violate the bank's prescribed 760 procedures, and the bank's procedures do not vary unreasonably 761 from general banking usage not disapproved by this chapter or 762 Chapter 1304.

763 (12) "Party" means a party to an instrument.

764 (13) "Principal obligor," with respect to an instrument, 765 means the accommodated party or any other party to the 766 instrument against whom a secondary obligor has recourse under 767 this chapter.

768 (14) "Promise" means a written undertaking to pay money 769 that is signed by the person undertaking to pay.

"Promise" does 770 not include an acknowledgment of an obligation by the obligor 771 unless the obligor also undertakes to pay the obligation.

772 (15) "Prove," with respect to a fact, means to meet the 773 burden of establishing the fact.

774 (16) "Remitter" means a person who purchases an instrument 775 from its issuer if the instrument is payable to an identified 776 person other than the purchaser.

777 (17) "Remotely-created consumer item" means an item drawn 778 on a consumer account, which is not created by the payor bank 779 and does not bear a handwritten signature purporting to be the 780 signature of the drawer.

781 (18) "Secondary obligor," with respect to an instrument, 782 means any of the following:

783 (a) An indorser or an accommodation party;

784(b) H.A drawer having the obligation described in division (D) of section 1303.54 of the Revised Code;

(c) Any other party to the instrument that has recourse against another party to the instrument pursuant to division (B) of section 1303.14 of the Revised Code.

(B) As used in this chapter:

(1) "Acceptance" has the same meaning as in section 1303.46 of the Revised Code.

(2) "Accommodation party" and "accommodated party" have the same meanings as in section 1303.59 of the Revised Code.

(3) "Account" has the same meaning as in section 1304.01 of the Revised Code.

(4) "Alteration" has the same meaning as in section 1303.50 of the Revised Code.

(5) "Anomalous indorsement," "blank indorsement," and "special indorsement" have the same meanings as in section 1303.25 of the Revised Code.

(6) "Certificate of deposit," "cashier's check," "check," "draft," "instrument," "negotiable instrument," "note," "teller's check," and "traveler's check" have the same meanings as in section 1303.03 of the Revised Code.

(7) "Certified check" has the same meaning as in section 1303.46 of the Revised Code.

Sub.

H.

195 Page136th 29G.A. As Passed by the House (b) A drawer having the obligation described in division 785 (D) of section 1303.54 of the Revised Code;

786(8) (c)"Consideration" Anyand other"value" partyhave to the instrumentsame thatmeanings hasas recoursein 787 against another party to the instrument pursuant to division (B) 788 of section 1303.141303.33 of the Revised Code.

789(9) (B)"Holder Asin useddue course" has the same meaning as in thissection chapter:1303.32 of the Revised Code.

790(10) (1)"Incomplete "Acceptance"instrument" has the same meaning as in section 7911303.11 1303.46 of the Revised Code.

792(11) (2)"Indorsement" "Accommodation party" and "accommodated"indorser" party" have 793 the same meanings as in section 1303.591303.24 of the Revised Code.

794(12) (3)"Negotiation" "Account" has the same meaning as in section 1304.011303.21 795 of the Revised Code.

796(13) (4)"Payable "Alteration"at hasa definite time" and "payable on demand" have the same meaningmeanings as in section 7971303.07 1303.50 of the Revised Code.

798(14) (5)"Payable "Anomalousto indorsement,"bearer" "blank indorsement," and 799"payable "specialto indorsement"order" have the same meanings as in section 8001303.10 1303.25 of the Revised Code.

801(15) (6)"Payment" "Certificatehas of deposit," "cashier's check," "check," 802 "draft," "instrument," "negotiable instrument," "note," 803 "teller's check," and "traveler's check" have the same meaningsmeaning 804 as in section 1303.031303.67 of the Revised Code.

805(16) (7)"Person "Certifiedentitled check"to enforce" has the same meaning as in section 8061303.31 1303.46 of the Revised Code.

807(17) (8)"Presentment" "Consideration"has and "value" have the same meaningsmeaning as 808 in section 1303.331303.61 of the Revised Code.

809(18) (9)"Reacquisition" "Holder in due course" has the same meaning as in 810 section 1303.321303.27 of the Revised Code.

811(19) H."Transfer of instrument" has the same meaning as in section 1303.22 of the Revised Code.

B.(C) As used in this chapter, "banking day," "clearing house," "collecting bank," "customer," "depositary bank," "documentary draft," "intermediary bank," "item," "midnight deadline," "payor bank," and "suspends payments" have the same meanings as in section 1304.01 of the Revised Code.

No.(D) In addition, Chapter 1301.

195of Page 30 As Passed by the HouseRevised (10)Code "Incompletecontains instrument"general hasdefinitions theand samegeneral meaningprinciples asof inconstruction 812and sectioninterpretation 1303.11applicable ofthroughout thethis Revisedchapter. Code.

813Sec. (11) "Indorsement" and "indorser" have the same meanings 814 as in section 1303.24 of the Revised Code.

815 (12) "Negotiation" has the same meaning as in section 816 1303.21 of the Revised Code.

817 (13) "Payable at a definite time" and "payable on demand" 818 have the same meanings as in section 1303.07 of the Revised 819 Code.

820 (14) "Payable to bearer" and "payable to order" have the 821 same meanings as in section 1303.10 of the Revised Code.

822 (15) "Payment" has the same meaning as in section 1303.67 823 of the Revised Code.

824 (16) "Person entitled to enforce" has the same meaning as 825 in section 1303.31 of the Revised Code.

826 (17) "Presentment" has the same meaning as in section 827 1303.61 of the Revised Code.

828 (18) "Reacquisition" has the same meaning as in section 829 1303.27 of the Revised Code.

830 (19) "Transfer of instrument" has the same meaning as in 831 section 1303.22 of the Revised Code.

832 (C) As used in this chapter, "banking day," "clearing 833 house," "collecting bank," "customer," "depositary bank," 834 "documentary draft," "intermediary bank," "item," "midnight 835 deadline," "payor bank," and "suspends payments" have the same 836 meanings as in section 1304.01 of the Revised Code.