Rethinking Commercial Law’s Uncertain Boundaries

Abstract

Although it is an essential part of business law, commercial law has uncertain boundaries. That uncertainty creates significant legal ambiguities and inconsistencies, confusing lawyers and courts and causing misinterpretations that disrupt commerce and reduce efficiency. This Article hypothesizes and tests possible explanations for the uncertainty, including that commercial law’s development has been path dependent, ad hoc, and lacking well-defined normative purposes. The Article then analyzes what those boundaries should be, arguing that commercial law should cover all business-related transfers of property, subject to exceptions needed to reduce transaction costs and otherwise increase economic efficiency. The Article also compares its proposed boundaries to the scope of commercial law under the Uniform Commercial Code, both to test whether those boundaries are tethered to reality and to examine whether the scope of the UCC itself should be modified.

Keywords: commercial law, UCC, path dependence, commerce