Uniform Law Source: Section 2-204; 2-305(4); 2A-204.

"Agreement". Section 1-201. "Contract". Section 2B-102. "Contract fee". Section 2B-102. "Electronic agent". Section 2B-102. "Information". Section 2B-102. "Licensee". Section 2B-102. "Licensor". Section 2B-102. "Party". Section 1-201. "Reason to know": Section 2B-102. "Receive". Section 2B-102. "Remedy". Section 1-201. "Term". Section 1-201.

1. Basic Rule. Subsection (a) conforms to current Article 2 and continues without change the basic policy of recognizing any manner of expression of agreement, oral, written, electronic, or otherwise. It follows the language of current Article 2, but adds an express reference to the operations of electronic agents as a form of establishing or showing agreement.

This Article separates two issues. One deals with whether a contract was formed. The second concerns what terms govern that contract. That issue is discussed in reference to records in Section 2B-207, 2B-208, and 2B-209. In many cases, the creation of a contract and its terms are simultaneous. But in modern commerce, the two are partially separable processes. That is true, for example, where the parties exchange conflicting forms and subsequently perform in a manner that creates a contract.

2. Electronic Agents. Article 2B clarifies that a contract can be formed by the operations of electronic agents. An electronic agent is an automated system selected or used by a person for purposes of achieving contract-related effects such as offer, acceptance, performance, and the like without review by a human being. The fact that the operations of an electronic agent are attributable to a party that selected the agent is confirmed in Section 2B-116.

Giving this effect to an electronic agent can be explained in several ways. One would observe simply that it gives force to a choice made by the party. That is, the party selected and deployed the automated system for a particular purpose and this Article acknowledges and enforces that purpose. Alternatively, it could be described as giving force to a form of indirect acceptance of a contractual relationship. The agent is in effect a mere extension of the person utilizing it and its actions constitute the actions of the individual. Under either approach, the basic theme is that the automated agent's operations bind the agent's creator or user. In article 2B, reference is simply made to the operations of agents as having specified effects in law and as being attributable in law under particular circumstances to a particular party.

3. Open Terms and Layered Transactions. Although recognizing a broad range of indicia of agreement, the standards adopted here require distinguishing preliminary negotiations or incomplete efforts to make a deal that do not create a contract and actions or statements that manifest an intent to be bound even though terms are left open or the time of formation cannot be determined. Ultimately, the distinction here as under current Article 2 from which these rules derive, often requires consideration of all of the circumstances relating to the alleged agreement.

As made clear in subsection (b), the distinction among these situations lies in the question of the existence of an intent to contract as manifested by the language, conduct or operations of the parties or their agents. Given an intent to contract and agreement on terms or performance that gives an adequate basis to grant a remedy, a contract can be formed despite the existence of terms remaining to be agreed and terms that are left open, that is, not addressed by the parties. In the latter case, this Article, general expectations of the trade, and general intellectual property law often provide background rules that flesh out the details of the relationship.

The background rules will not apply if the parties in fact disagree about the term. While disagreement may not always bar creation of a contract, it often indicates no agreement.

The rules of this Section provide the foundation for recognition here, as in existing Article 2, of a layered process of contracting which typifies many areas of commerce and many major contractual relationships. There is no requirement that agreement to all terms occur at one point. Rather, contracts are often formed over a period of time, and contract terms are very often developed and adopted during performance, rather than at the outset. In some cases, these later adopted terms might conceptually be viewed as a modification of an agreement, but it is often the case that the parties expect to arrive a terms and adopt records later in the deal. Rather than a modification, these are more aptly described as a fulfillment of prior expectations or normal practice. This Section recognizes that phenomenon; Section 2B-207 and 2B-208 provide some guidance on its operation with respect to the adoption of terms. If the parties do not intend to be bound unless later terms are agreed to, subsection (e) gives guidance for unwinding the relationship.

4. Material Terms and Scope of a License. Subsection (d) clarifies an obvious principle. It provides simply that a material disagreement about an important (material) term indicates that no intent to enter a contract exists at that time. This rule is important in reference to general formation concepts in an environment where open terms and to be agreed terms are permitted. It is also important in the treatment of an exchange of purported offers and acceptances that contain varying terms. As described in Section 2B-203, a contract can be formed by an acceptance that varies the terms of the offer. Yet, it is clear that not all variances indicate an intent to contract. See White & Summers, The Uniform Commercial Code (1995) (discussion of battle of forms).

In information commerce, the most significant terms of a contract deal with the scope of the license. Scope is a defined term. See Section 2B-102. It goes to the fundamentals of the transaction and what the licensor intends to transfer and what the licensee expects to receive. Indeed, in many respects, in this field of commerce, the contract is the product and scope is the basic product description. Disagreements about this fundamental issue are like ordering a Corvette and confirming purchase of a Volkswagon. They indicate fundamental disagreement about the nature of the contract and its subject matter.

This Section does not require complete and detailed agreement about scope in order to form a contract. It does confirm, however, that material disagreement about scope indicates a lack of an agreement sufficient to form a contract.