Trade Usage in the Courts: The Flawed Evidentiary Basis of Article 2's Incorporation Strategy

Lisa Bernstein

This essay presents the results a study of all of the sales-related trade usage cases digested under the Uniform Commercial Code’s trade usage provision from 1970-2007.  Its goal is to produce an empirically accurate picture of the ways that trade usage component of the Code’s incorporation strategy (a strategy that is also at the heart of most international commercial law statutes) is being used by parties and applied by courts in sales disputes. The picture of trade usage disputes that emerges from the study of usage in the courts demonstrates that trade usage arguments are being made for reasons very different from those suggested by the incorporation’s defenders and that the type of evidence that incorporations defenders and modern treatise writers assume will be introduced to demonstrate the existence and content of usages, is rarely, if ever, introduced. The essay concludes by drawings on the findings of the study to explore the strengths and weakness of the empirical assumptions and analytical arguments behind the incorporation strategy and suggesting that in light of its findings some changes in the Uniform Commercial Code are warranted.