Under UCC Article 2, a contract for sale of goods may be formed by

Under UCC Article 2, a contract for sale of goods may be formed by

• A. Written signature by both parties only
• B. Conduct by both parties recognizing existence of such a contract
• C. Formal oral agreement only
• D. Oral agreements are never valid

Answer: (B)

Under UCC Article 2, a contract for the sale of goods can be formed by conduct that shows the parties’ agreement. Section 2-204 provides that a contract may be formed in any manner sufficient to show agreement, including conduct by both parties. This means that if the buyer and seller act as though a contract exists—starting performance, exchanging goods or assurances, or otherwise recognizing the contract without a formal written agreement—the contract is valid, even without a signed writing. The writing requirement under the Statute of Frauds is a separate issue that affects enforceability for certain contracts (for example, large-sum sales), but it does not bar formation. Therefore, contracts formed by conduct are perfectly valid, and the other options overemphasize formal writings or deny the validity of oral arrangements.

Under UCC Article 2, a contract for the sale of goods can be formed by conduct that shows the parties’ agreement. Section 2-204 provides that a contract may be formed in any manner sufficient to show agreement, including conduct by both parties. This means that if the buyer and seller act as though a contract exists—starting performance, exchanging goods or assurances, or otherwise recognizing the contract without a formal written agreement—the contract is valid, even without a signed writing.

The writing requirement under the Statute of Frauds is a separate issue that affects enforceability for certain contracts (for example, large-sum sales), but it does not bar formation. Therefore, contracts formed by conduct are perfectly valid, and the other options overemphasize formal writings or deny the validity of oral arrangements.