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This entry was published on 2014-12-26
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Course of Performance, Course of Dealing, and Usage of Trade
Uniform Commercial Code (UCC) CHAPTER 38, ARTICLE 1, PART 3
Section 1--303. Course of Performance, Course of Dealing, and Usage of


(a) A "course of performance" is a sequence of conduct between the
parties to a particular transaction that exists if:

(1) the agreement of the parties with respect to the transaction
involves repeated occasions for performance by a party; and

(2) the other party, with knowledge of the nature of the performance
and opportunity for objection to it, accepts the performance or
acquiesces to it without objection.

(b) A "course of dealing" is a sequence of conduct concerning previous
transactions between the parties to a particular transaction that is
fairly to be regarded as establishing a common basis of understanding
for interpreting their expressions and other conduct.

(c) 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 must be
proved as facts. If it is established that such a usage is embodied in a
trade code or similar record, the interpretation of the record is a
question of law.

(d) A course of performance or course of dealing between the parties
or usage of trade in the vocation or trade in which they are engaged or
of which they are or should be aware is relevant in ascertaining the
meaning of the parties' agreement, may give particular meaning to
specific terms of the agreement, and may supplement or qualify the terms
of the agreement. A usage of trade applicable in the place in which part
of the performance under the agreement is to occur may be so utilized as
to that part of the performance.

(e) Except as otherwise provided in subsection (f), the express terms
of an agreement and any applicable course of performance, course of
dealing, or usage of trade must be construed whenever reasonable as
consistent with each other. If such a construction is unreasonable:

(1) express terms prevail over course of performance, course of
dealing, and usage of trade;

(2) course of performance prevails over course of dealing and usage of
trade; and

(3) course of dealing prevails over usage of trade.

(f) Subject to Section 2--209, a course of performance is relevant to
show a waiver or modification of any term inconsistent with the course
of performance.

(g) Evidence of a relevant usage of trade offered by one party is not
admissible unless that party has given the other party notice that the
court finds sufficient to prevent unfair surprise to the other party.