Flojo International, Inc. v. Lassleben

Opinion

FROEHLICH, J.

This appeal deals with the enforceability of contract commitments made in the course of reorganization of a rubber sandal distribution business. We conclude that the trial court erred in ruling that no consideration supported commitments made by the corporation in connection with the reorganization, and we also determine that the trial court erred in not recognizing the provisions of the California Uniform Commercial Code which govern the rights of a transferee of a negotiable instrument.

Factual and Procedural Background

The parties to this transaction are two families and…