Statutory Interpretation and the Lessons of Llewellyn

Abstract:     
Although the Uniform Commercial Code statute was the work of many individuals, more than any other person, Karl Llewellyn was responsible for the creation of the UCC. Llewellyn acted as Chief Reporter for the Code from its inception in 1940 until 1962. Furthermore, each article of the Code had a principal drafter assigned to it, and Llewellyn was the drafter for Articles 1 and 2. Accordingly, "[t]he relationship of Llewellyn's philosophy to the Code's content and drafting style can be seen most clearly in these two articles."

Articles 1 and 2 clearly reflect the view that the meaning of a sales contract depends upon the context within which it is made and executed. Section 2-202, for example, contains the UCC's relaxed version of the parol evidence rule, which allows for the introduction of "any prior agreement or of [any] contemporaneous oral agreement" so long as it does not contradict the "final expression" of the parties' contract. Section 2-202 likewise permits the introduction of "evidence of consistent additional terms," "course of dealing," "usage of trade," and "course of performance" in order to explain or supplement the final expression of the agreement. Prior to the UCC, the use of such evidence was severely restricted. The way in which the Code made contextual evidence an integral part of contractual meaning was an important innovation.

The significance of this change is most evident in the Code's definition of "agreement." Section 1-201(3) defines "agreement" as "the bargain of the parties in fact as found in their language or by implication from other circumstances including course of dealing or usage of trade or course of performance as provided in this Act." Thus, the background is no longer something that can be acknowledged and then ignored. Instead, the context of an agreement becomes central to its meaning.

Number of Pages in PDF File: 189

Keywords: Karl Llewellyn, statutory reform, universal commercial code, ucc, parol evidence rule

JEL Classification: K12, K40

Accepted Paper Series