Course of Dealing

Course of Dealing

A clearly recognizable pattern of previous conduct between parties to a business transaction.

The course of dealing between parties to an action is examined by a court in ascertaining what the parties intended when they entered into a contract. The supposition is that the parties drew up the contract in view of the customary manner in which business had been transacted prior to the signing of the contract.

In a breach-of-contract action, evidence of the course of dealing is admissible in order to interpret ambiguities in the contract, but not to effectuate an alteration or contradiction of the contract's provisions. A term that was seemingly unambiguous when the contract was entered into might subsequently prove to be problematic.

Course of dealing is distinguishable from both Course of Performance and Trade Usage. Course of performance refers to a pattern of conduct that occurs subsequent to approval of the contract terms. Trade usage entails behavior that is the standard of conformity for a majority of businesses engaged in a particular business or commercial venture.

Course of dealing safeguards the expectations of the parties and augments the certainty of their transactions, based upon their prior experiences with each other.

The concepts of course of dealing, course of performance, and trade usage in the context of contract law are derived largely from the work of linton corbin, who did not believe that courts should be bound by the so-called four corners of a contract or to the "plain meaning" to those terms. Corbin was instrumental in the drafting of the Uniform Commercial Code (UCC), which governs commercial agreements and transactions in most states. The UCC defines course of dealing in its general provisions (U.C.C. § 1-205). The term applies, for example, to the laws governing contracts for the sale of goods, negotiable instruments, and Secured Transactions.

References in periodicals archive ?
3) There is a course of dealing over an extended period of time that would have put objectively reasonable insurance agents on notice that their advice was being sought and specially relied on.
The creditors also argued that the relief sought by the motion: (a) undermines the legislative history of Section 503(b)(9); (b) infringes on their state law setoff rights; (c) allows the debtors to use Section 558 as a sword, not as a defensive shield; and (d) fails to recognize that the debtors' setoff rights might be limited by the debtors' and creditors' contract and prior course of dealing.
He added: "I've not seen a better one, frankly, in the course of dealing with quite a few years of fraud.
Whether an insurance salesman is an agent of the insurance company is fact sensitive and requires a consideration of many factors, including the relation of the parties, their actions, usual course of dealing, any instructions given to the person by the company, the conduct of the parties generally, and the nature of the transaction.
During the course of dealing with the incident, a firefighter suffered burns to his hands.
What is problematic with the Courts' findings, and the author's analysis of those findings, is that neither the single claim pleaded against the retail broker by the insured in the amended complaint, nor the evidence adduced in the record before the trial Court, asserted a theory of recovery based upon a course of dealing between the insured and the retailer.
Responding to a question, he said the bigger provinces should change its course of dealing with small provinces.
12) While course of dealing has influenced contract interpretation to some degree for over one hundred years, its formal adoption by the U.
While there is little case law exploring the contours of the common interest doctrine under these circumstances, it is apparent that a court would need to consider the unique facts of each particular case, including the course of dealing between the carrier and the insured as well as the nature of the documents or information at issue.
In the course of dealing with literally thousands of customers over the years, IT experts at TSG have heard more than their fair share of nightmare tales.
Alternating by chapters with the foregoing, there also is a third story of Henderson, a British army officer who had lost an eye but gained a very special spear, an African assegai, in the course of dealing with assorted renegades and the like in the "Dark Continent", during the days of Empire.