"Fault" means wrongful act, omission or breach.
"Fungible" with respect to goods or securities means goods or securities of which any unit is, by nature or usage of trade, the equivalent of any other like unit. Goods which are not fungible shall be deemed fungible for chs. 401
to the extent that under a particular agreement or document unlike units are treated as equivalents.
"Genuine" means free of forgery or counterfeiting.
"Good faith" means honesty in fact in the conduct or transaction concerned.
"Holder", with respect to a negotiable instrument, means the person in possession if the instrument is payable to bearer or, in the case of an instrument payable to an identified person, if the identified person is in possession. "Holder", with respect to a document of title, means the person in possession if the goods are deliverable to bearer or to the order of the person in possession.
To "honor" is to pay or to accept and pay, or where a credit so engages to purchase or discount a draft complying with the terms of the credit.
"Insolvency proceedings" includes any assignment for the benefit of creditors or other proceedings intended to liquidate or rehabilitate the estate of the person involved.
A person is "insolvent" who either has ceased to pay his or her debts in the ordinary course of business or cannot pay his or her debts as they become due or is insolvent within the meaning of the federal bankruptcy law.
A person "knows" or has "knowledge" of a fact when the person has actual knowledge of it. "Discover" or "learn" or a word or phrase of similar import refers to knowledge rather than to reason to know. The time and circumstances under which a notice or notification may cease to be effective are not determined by chs. 401
"Money" means a medium of exchange authorized or adopted by a domestic or foreign government and includes a monetary unit of account established by an intergovernmental organization or by agreement between 2 or more nations.
The person has received a notice or notification of it; or
From all the facts and circumstances known at the time in question the person has reason to know that it exists.
A person "notifies" or "gives" a notice or notification to another by taking such steps as may be reasonably required to inform the other in ordinary course whether or not such other actually comes to know of it. A person "receives" a notice or notification when:
It is duly delivered at the place of business through which the contract was made or at any other place held out by the person as the place for receipt of such communications.
Notice, knowledge or a notice or notification received by an organization is effective for a particular transaction from the time when it is brought to the attention of the individual conducting that transaction, and in any event from the time when it would have been brought to the individual's attention if the organization had exercised due diligence. An organization exercises due diligence if it maintains reasonable routines for communicating significant information to the person conducting the transaction and there is reasonable compliance with the routines. Due diligence does not require an individual acting for the organization to communicate information unless such communication is part of the individual's regular duties or unless the individual has reason to know of the transaction and that the transaction would be materially affected by the information.
"Organization" includes a corporation, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, 2 or more persons having a joint or common interest, or any other legal or commercial entity.
"Party", as distinct from "3rd party", means a person who has engaged in a transaction or made an agreement within chs. 401
"Presumption" or "presumed" means that the trier of fact must find the existence of the fact presumed unless and until evidence is introduced which would support a finding of its nonexistence.
"Purchase" includes taking by sale, discount, negotiation, mortgage, pledge, lien, security interest, issue or reissue, gift or any other voluntary transaction creating an interest in property.
"Purchaser" means a person who takes by purchase.
"Remedy" means any remedial right to which an aggrieved party is entitled with or without resort to a tribunal.
"Representative" includes an agent, an officer of a corporation or association, and a trustee or personal representative of an estate, or any other person empowered to act for another.
"Security interest" means an interest in personal property or fixtures which secures payment or performance of an obligation. The term also 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 ch. 409
. The special property interest of a buyer of goods on identification of those goods to a contract for sale under s. 402.401
is not a security interest, but a buyer may also acquire a security interest by complying with ch. 409
. Except as otherwise provided in s. 402.505
, the right of a seller or lessor of goods under ch. 402
to retain or acquire possession of the goods is not a security interest, but a seller or lessor may also acquire a security interest by complying with ch. 409
. The retention or reservation of title by a seller of goods notwithstanding shipment or delivery to the buyer under s. 402.401
is limited in effect to a reservation of a security interest.
Whether a transaction creates a lease or security interest is determined by the facts of each case. A transaction creates a security interest if the consideration that the lessee is to pay the lessor for the right to possession and use of the goods is an obligation for the term of the lease not subject to termination by the lessee and any of the following applies:
The original term of the lease is equal to or greater than the remaining economic life of the goods.
The lessee is bound to renew the lease for the remaining economic life of the goods or is bound to become the owner of the goods.
The lessee has an option to renew the lease for the remaining economic life of the goods for no additional consideration or nominal additional consideration upon compliance with the lease agreement.
The lessee has an option to become the owner of the goods for no additional consideration or nominal additional consideration upon compliance with the lease agreement.
A transaction does not create a security interest merely because it provides any of the following:
That the present value, as defined in s. 411.103 (1) (u)
, of the consideration that the lessee is obligated to pay the lessor for the right to possession and use of the goods is substantially equal to or is greater than the fair market value of the goods when the lease is entered into.
That the lessee assumes risk of loss of the goods, or agrees to pay taxes, insurance, filing, recording or registration fees, or service or maintenance costs with respect to the goods.
That the lessee has an option to renew the lease or to become the owner of the goods.
That the lessee has an option to renew the lease for a fixed rent that is equal to or greater than the reasonably predictable fair market rent for the use of the goods for the term of the renewal when the option is to be performed.
That the lessee has an option to become the owner of the goods for a fixed price that is equal to or greater than the reasonably predictable fair market value of the goods when the option is to be performed.
Additional consideration is not nominal if, when the option to renew the lease is granted to the lessee, the rent is stated to be the fair market rent for the use of the goods for the term of the renewal determined when the option is to be performed, or when the option to become the owner of the goods is granted to the lessee the price is stated to be the fair market value of the goods determined when the option is to be performed. Additional consideration is nominal if it is less than the lessee's reasonably predictable cost of performing under the lease agreement if the option is not exercised.
Reasonably predictable and remaining economic life of the goods are determined with reference to the facts and circumstances when the transaction is entered into.
"Send" in connection with any writing or notice means to deposit in the mail or deliver for transmission by any other usual means of communication with postage or cost of transmission provided for and properly addressed and in the case of an instrument to an address specified thereon or otherwise agreed, or if there is none to any address reasonable under the circumstances. The receipt of any writing or notice within the time at which it would have arrived if properly sent has the effect of a proper sending.
"Signed" includes any symbol executed or adopted by a party with present intention to authenticate a writing.
"Telegram" includes a message transmitted by radio, teletype, cable, any mechanical method of transmission, or the like.
"Term" means that portion of an agreement which relates to a particular matter.
"Unauthorized" signature means one made without actual, implied or apparent authority and includes a forgery.
"Value". Except as otherwise provided with respect to negotiable instruments and bank collections (ss. 403.303
) a person gives "value" for rights if the person acquires them:
In return for a binding commitment to extend credit or for the extension of immediately available credit whether or not drawn upon and whether or not a charge-back is provided for in the event of difficulties in collection; or
As security for or in total or partial satisfaction of a preexisting claim; or
By accepting delivery pursuant to a preexisting contract for purchase; or
Generally, in return for any consideration sufficient to support a simple contract.
"Warehouse receipt" means a receipt issued by a person engaged in the business of storing goods for hire.
"Written" or "writing" includes printing, typewriting or any other intentional reduction to tangible form.
Purchasers became buyers in the ordinary course of business when goods became identified to a purchase contract. Daniels v. Bank of Hayward, 144 Wis. 2d 931
, 425 N.W.2d 416
Buyer in ordinary course of business under article 9 of the uniform commercial code (and related matters). Skilton, 1974 WLR 1.
Prima facie evidence by 3rd-party documents.
A document in due form purporting to be a bill of lading, policy or certificate of insurance, official weigher's or inspector's certificate, consular invoice, or any other document authorized or required by the contract to be issued by a 3rd party shall be prima facie evidence of its own authenticity and genuineness and of the facts stated in the document by the 3rd party.
History: 2005 a. 253
Obligation of good faith.
Every contract or duty within chs. 401
imposes an obligation of good faith in its performance or enforcement.
History: 1979 c. 89
; 1991 a. 148
This section does not support an independent cause of action for failure to act in good faith under a contract. Hauer v. Union State Bank of Wautoma, 192 Wis. 2d 576
, 532 N.W.2d 456
(Ct. App. 1995).
Good faith under the code. Eisenberg, 54 MLR 1.
Time; reasonable time; "seasonably". 401.204(1)(1)
Whenever chs. 401
require any action to be taken within a reasonable time, any time which is not manifestly unreasonable may be fixed by agreement.
What is a reasonable time for taking any action depends on the nature, purpose and circumstances of such action.
An action is taken "seasonably" when it is taken at or within the time agreed or if no time is agreed at or within a reasonable time.
History: 1979 c. 89
; 1991 a. 148
Course of dealing and usage of trade. 401.205(1)
A course of dealing is a sequence of previous conduct between the parties to a particular transaction which is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.
A usage of trade is any practice or method of dealing having such regularity of observance in a place, vocation or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage are to be proved as facts. If it is established that such a usage is embodied in a written trade code or similar writing the interpretation of the writing is for the court.
A course of dealing between parties and any usage of trade in the vocation or trade in which they are engaged or of which they are or should be aware give particular meaning to and supplement or qualify terms of an agreement.
The express terms of an agreement and an applicable course of dealing or usage of trade shall be construed wherever reasonable as consistent with each other; but when such construction is unreasonable express terms control both course of dealing and usage of trade and course of dealing controls usage of trade.
An applicable usage of trade in the place where any part of performance is to occur shall be used in interpreting the agreement as to that part of the performance.
Evidence of a relevant usage of trade offered by one party is not admissible unless and until the party has given the other party such notice as the court finds sufficient to prevent unfair surprise to the latter.
History: 1991 a. 316
A single incident does not constitute a "course of dealing" within the meaning of this section. Maritime-Ontario Freight Lines, LTD. v. STI Holdings, Inc. 481 F. Supp. 2d 963
Statute of frauds for kinds of personal property not otherwise covered. 401.206(1)
Except in the cases described in sub. (2)
a contract for the sale of personal property for the price of $5,000 or more is not enforceable by way of action or defense unless there is some writing which indicates that a contract for sale has been made between the parties at a defined or stated price, reasonably identifies the subject matter, and is signed by the party against whom enforcement is sought or by the party's authorized agent.
A contract which, but for sub. (1)
would be enforceable, is enforceable:
If the party against whom enforcement is sought admits in that party's pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under sub. (1)
beyond the quantity or extent of personal property admitted; or
With respect to personal property for which payment has been made and accepted or which has been received and accepted.
History: 1991 a. 316
; 1997 a. 297
A memo regarding negotiations for a sale did not satisfy the statute of frauds. Dairyland Financial Corp. v. FICB of St. Paul, 852 F.2d 242
(7th Cir. 1988).