UCC 1-207 (Legal Definition And All You Must Know)

What is UCC 1-207?

How do you legally define it?

What are the essential elements you should know!

Keep reading as we have gathered exactly the information that you need!

Let’s dig into our Uniform Commercial Code knowledge!

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UCC 1 207 Explained

Under New York laws, Section UCC1 207 of the 2012 New York Consolidated Laws UCC is titled “Performance or Acceptance Under Reservation of Rights”.

Section 1 207 UCC outlines that a party who agrees to perform any obligation or offer his or her assent with reservations will not cause prejudice to the rights reserved.

Typically, to express reservation, the following phrases may be used:

  • Under Protest
  • Without Prejudice
  • Under Reserve 

UCC 1-207 New York Statute of Frauds

UCC1207 can also refer to Section 1-207 of Part 2 of the New York Uniform Commercial Code titled “Statute of Frauds for Kinds of Personal Property Not Otherwise Covered”.

UCC 1-207 Modification

Section UCC 1-207 was modified to become UCC 1-308 in 2004.

Section 1-308 of the Uniform Commercial Code titled “Performance or Acceptance Under Reservation of Rights”.

UCC 1-308 states:

A party that with explicit reservation of rights performs or promises performance or assents to performance in a manner demanded or offered by the other party does not thereby prejudice the rights reserved. Such words as “without prejudice,” “under protest,” or the like are sufficient.
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In essence, a party to a contract may continue performing its obligations “under protest”, “without prejudice” or “under reserve”, in such a way that the party’s performance cannot affect potential legal recourse against the other party.

Under this provision, a person, entity, or party can expressly deny any waiver of rights regarding a particular document or the performance of certain legal obligations.

Without Prejudice

What does “without prejudice” mean?

When you state without prejudice on top of a letter or in an email, you are stating to the receiving party that you are reserving your rights with regards to the content of the letter.

For example, if an attorney makes a settlement proposal to another party in a letter, the attorney will indicate the phrase “without prejudice” to state something like “I’m making this offer to you but you should not hold it against me if we cannot agree”.

Under Protest

What does the phrase “under protest” mean?

Under protest means that you are performing something or doing something although you do not agree that it must be done or you have objections.

For example, if a contract states that you must make a payment by a certain deadline if not the entire project will be suspended, you may make an invoice payment (even though you think you have valid objections) just to avoid stalling the project but at the same time indicating that the payment is not your acceptance.

Takeaways 

So what is the legal definition of UCC 1-207?

What do you mean by UCC 1 207 without prejudice?

Let’s look at a summary of our findings.

UCC 1-207:

  • UCC1207 has been replaced with UCC1308
  • Under this provision, a person may make a promise, perform an obligation, or assent to perform an obligation without losing legal rights if it was done with explicit reservation 
  • The reservation can be expressed as “without prejudice”, “under protest”, “under reserve” or another similar phrase 
  • The Uniform Commercial Code 1 2017 in New York is titled “Performance or Acceptance Under Reservation of Rights”
  • UCC 1207 also refers to “Statute of Frauds for Kinds of Personal Property Not Otherwise Covered” in New York law
Breach of contract
Cease and desist 
Contract law 
Notice of default
UCC 1-103
UCC 1-201
Under reserve
With protest 
Without prejudice 
Without prior notice
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