(1) "Goods" means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities (Article 8) and things in action. "Goods" also includes the unborn young of animals and growing crops and other identified things attached to realty as described in the section on goods to be severed from realty (Section 2-107 [55-2-107 NMSA 1978] ).
(2) Goods must be both existing and identified before any interest in them can pass. Goods which are not both existing and identified are "future" goods. A purported present sale of future goods or of any interest therein operates as a contract to sell.
(3) There may be a sale of a part interest in existing identified goods.
(4) An undivided share in an identified bulk of fungible goods is sufficiently identified to be sold although the quantity of the bulk is not determined. Any agreed proportion of such a bulk or any quantity thereof agreed upon by number, weight or other measure may to the extent of the seller's interest in the bulk be sold to the buyer who then becomes an owner in common.
(5) "Lot" means a parcel or a single article which is the subject matter of a separate sale or delivery, whether or not it is sufficient to perform the contract.
(6) "Commercial unit" means such a unit of goods as by commercial usage is a single whole for purposes of sale and division of which materially impairs its character or value on the market or in use. A commercial unit may be a single article (as a machine) or a set of articles (as a suite of furniture or an assortment of sizes) or a quantity (as a bale, gross or carload) or any other unit treated in use or in the relevant market as a single whole.
History: 1953 Comp., § 50A-2-105, enacted by Laws 1961, ch. 96, § 2-105.
ANNOTATIONSOFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
Prior uniform statutory provision. — Subsections (1), (2), (3) and (4) - Sections 5, 6 and 76, Uniform Sales Act; Subsections (5) and (6) - none.
Changes. — Rewritten.
1. Subsection (1) on "goods": The phraseology of the prior uniform statutory provision has been changed so that:
The definition of goods is based on the concept of movability and the term "chattels personal" is not used. It is not intended to deal with things which are not fairly identifiable as movables before the contract is performed.
Growing crops are included within the definition of goods since they are frequently intended for sale. The concept of "industrial" growing crops has been abandoned, for under modern practices fruit, perennial hay, nursery stock and the like must be brought within the scope of this article. The young of animals are also included expressly in this definition since they, too, are frequently intended for sale and may be contracted for before birth. The period of gestation of domestic animals is such that the provisions of the section on identification can apply as in the case of crops to be planted. The reason of this definition also leads to the inclusion of a wool crop or the like as "goods" subject to identification under this article.
The exclusion of "money in which the price is to be paid" from the definition of goods does not mean that foreign currency which is included in the definition of money may not be the subject matter of a sales transaction. Goods is intended to cover the sale of money when money is being treated as a commodity but not to include it when money is the medium of payment.
As to contracts to sell timber, minerals or structures to be removed from the land Section 2-107(1) (Goods to be severed from Realty: recording) controls.
The use of the word "fixtures" is avoided in view of the diversity of definitions of that term. This article in including within its scope "things attached to realty" adds the further test that they must be capable of severance without material harm thereto. As between the parties any identified things which fall within that definition become "goods" upon the making of the contract for sale.
"Investment securities" are expressly excluded from the coverage of this article. It is not intended by this exclusion, however, to prevent the application of a particular section of this article by analogy to securities (as was done with the Original Sales Act in Agar v. Orda, 264 N.Y. 248, 190 N.E. 479, 99 A.L.R. 269 (1934)) when the reason of that section makes such application sensible and the situation involved is not covered by the article of this act dealing specifically with such securities (Article 8).
2. References to the fact that a contract for sale can extend to future or contingent goods and that ownership in common follows the sale of a part interest have been omitted here as obvious without need for expression; hence no inference to negate these principles should be drawn from their omission.
3. Subsection (4) does not touch the question of how far an appropriation of a bulk of fungible goods may or may not satisfy the contract for sale.
4. Subsections (5) and (6) on "lot" and "commercial unit" are introduced to aid in the phrasing of later sections.
5. The question of when an identification of goods takes place is determined by the provisions of Section 2-501 and all that this section says is what kinds of goods may be the subject of a sale.
Point 1: Sections 2-107, 2-201, 2-501 and Article 8.
Point 5: Section 2-501.
See also Section 1-201.
"Buyer". Section 2-103.
"Contract". Section 1-201.
"Contract for sale". Section 2-106.
"Fungible". Section 1-201.
"Money". Section 1-201.
"Present sale". Section 2-106.
"Sale". Section 2-106.
"Seller". Section 2-103.
A sale involving the transfer of a business as a going concern, such as a catalog sales business, is not a transaction in goods. Stewart v. Lucero, 1996-NMSC-027, 121 N.M. 722, 918 P.2d 1 (1996).
Mixed contract. — Where the contract between plaintiff and defendant required plaintiff to create the interior design for defendant's health care facility, to sell furnishings to defendant to complete the designs, and to perform twenty-three itemized services during the project; and the fee for plaintiff's interior design services was generated through markups on furnishings plaintiff purchased and resold to defendant for use in the health care facility, the primary purpose of the contract was to provide interior design services and was not a contract for the sale of goods. Kirkpatrick v. Introspect Healthcare Corp., 1992-NMSC-070, 114 N.M. 706, 845 P.2d 800.
A sale of ski lifts is a sale of goods as defined by this section. Riblet Tramway Co. v. Monte Verde Corp., 453 F.2d 313 (10th Cir. 1972).
Sale of crude oil by producers is a sale of goods, and is governed by Article 2 of the Code. Amoco Pipeline Co. v. Admiral Crude Oil Corp., 490 F.2d 114 (10th Cir. 1974).
Immovables not goods. — Radio license, goodwill, real estate, studios and transmission equipment are not movables and hence not "goods" within the meaning of this section. Foster v. Colorado Radio Corp., 381 F.2d 222 (10th Cir. 1967).
The term "goods" includes livestock, since they are frequently intended for commercial sale. O'Shea v. Hatch, 1982-NMCA-013, 97 N.M. 409, 640 P.2d 515.
Boat is considered "goods" within this chapter. Elephant Butte Resort Marina, Inc. v. Wooldridge, 1985-NMSC-014, 102 N.M. 286, 694 P.2d 1351.
Law reviews. — For comment, "Commercial Law - Uniform Commercial Code - Sale of Goods," see 8 Nat. Resources J. 176 (1968).
For annual survey of commercial law in New Mexico, see 18 N.M.L. Rev. 313 (1988).
Am. Jur. 2d, A.L.R. and C.J.S. references. — Mutuality and enforceability of contracts to furnish another with his needs, wants, desires, requirements, etc., of certain commodities, 14 A.L.R. 1300, 26 A.L.R. 2d 1139.
Substantial performance of contract for manufacture or sale of article, 19 A.L.R. 815.
Validity and construction of contract for sale of season's output, 23 A.L.R. 574.
Seller's estoppel to deny existence of property sold, 40 A.L.R. 382.
Contract of sale which calls for a definite quantity but leaves a quality, grade or assortment optional with one of the parties as subject to objection of indefiniteness, 105 A.L.R. 1283.
Construction and effect of contract for sale of commodity or goods where quantity is described as "about" or "more or less" than an amount specified, 58 A.L.R.2d 377.
What constitutes "goods" within the scope of UCC Article 2, 4 A.L.R.4th 912.
Applicability of UCC Article 2 to mixed contracts for sale of goods and services, 5 A.L.R.4th 501.
Conveyance of land as including mature but unharvested crops, 51 A.L.R.4th 1263.
77A C.J.S. Sales § 1 et seq.; 82 C.J.S. Statutes § 315.