California Codes

Cal. Commercial Code § 1303 (2026)

✓ current as of May 2026
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(a)A “course of performance” is a sequence of conduct between the parties to a particular transaction that exists if:

(1)the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and

(2)the other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection.

(b)A “course of dealing” is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.

(c)A “usage of trade” is any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.

(d)A course of performance or course of dealing between the parties or usage of trade in the vocation or trade in which they are engaged or of which they are or should be aware is relevant in ascertaining the meaning of the parties’ agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the agreement. A usage of trade applicable in the place in which part of the performance under the agreement is to occur may be so utilized as to that part of the performance.

(e)Except as otherwise provided in subdivision (f), the express terms of an agreement and any applicable course of performance, course of dealing, or usage of trade must be construed whenever reasonable as consistent with each other. If such a construction is unreasonable:

(1)express terms prevail over course of performance, course of dealing, and usage of trade;

(2)course of performance prevails over course of dealing and usage of trade;

(3)course of dealing prevails over usage of trade.

(f)Subject to Section 2209, a course of performance is relevant to show a waiver or modification of any term inconsistent with the course of performance.

(g)Evidence of a relevant usage of trade offered by one party is not admissible unless that party has given the other party notice that the court finds sufficient to prevent unfair surprise to the other party.

Notes of Decisions
Cited in 10 cases (1 in the last 5 years), 2009–2023 · leading case: Lennar Mare Island, LLC v. Steadfast Ins., 176 F. Supp. 3d 949 (E.D. Cal. 2016).
Lennar Mare Island, LLC v. Steadfast Ins., 176 F. Supp. 3d 949 (E.D. Cal. 2016). · cites it 5× “” Cal. Com. Code § 1303 (a). It exists if both (1) the parties’ agreement “involves repeated occasions for performance” by one of them and (2) the other has “knowledge of the nature of the performance and opportunity for objection to it” but “accepts the performance or…”
SCO Grp., Inc. v. Novell, Inc., 578 F.3d 1201 (10th Cir. 2009). “Is the Scope of Novell’s Waiver Rights Susceptible to SCO’s Reading? Although the parties present a variety of arguments concerning the extrinsic evidence bearing on the parties’ intent at the time of the APA and the parties’ course of performance, we think a discussion of the…”
Stewart v. Screen Gems-Emi Music, Inc., 81 F. Supp. 3d 938 (N.D. Cal. 2015). “) California law defines course of performance as: a sequence of conduct between the parties to a particular transaction that exists if (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and (2) the other…”
Morgan Tire of Sacramento, Inc. v. Goodyear Tire & Rubber Co., 60 F. Supp. 3d 1109 (E.D. Cal. 2014). · cites it 2× ““A ‘course of dealing’ is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.”
Letizia v. Facebook Inc., 267 F. Supp. 3d 1235 (N.D. Cal. 2017). “ence of conduct between the parties to a particular transaction that exists if: (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and *1250 (2) the other party, with knowledge of the nature of the performance…”
Ample Bright Dev., Ltd. v. Comis Int'l, 913 F. Supp. 2d 925 (C.D. Cal. 2012). · cites it 2× “, § 1 — 303(d) (providing that a course of performance or course of dealing between the parties “is relevant in ascertaining the meaning of the parties’ agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the…”
G.P.P., Inc. v. Guardian Prot. Prods. (9th Cir. 2019). “1968); see also Cal. Com. Code § 1303 (f); Cal. Civ. Proc.”
Global Disposal Reduction Servs., Inc v. Allied Waste Sys., Inc. (S.D. Cal. 2023). “Code § 1205 , renumbered to Cal. Com. Code § 1303 and 18 amended by 2006 Cal.”
O'Reilly Auto Enter., LLC v. United States Fire Ins. Co. (W.D. Mo. 2020). “Cal. Com. Code § 1303 (Deering, Lexis Advance through all 870 Chapters of the 2019 Regular Session).”
Seaton Ins. v. Yosemite Ins., 748 F. Supp. 2d 139 (D.R.I. 2010). “Seaton does not argue that this is a UCC case, or that Seaton can satisfy the requirements of § 2209 of California’s Commercial Code, which must be met to demonstrate modification of contractual terms that contradict the course of performance.”
— Cal. Commercial Code § 1303(a) — 1 case
Stewart v. Screen Gems-Emi Music, Inc., 81 F. Supp. 3d 938 (N.D. Cal. 2015). “) California law defines course of performance as: a sequence of conduct between the parties to a particular transaction that exists if (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and (2) the other…”
— Cal. Commercial Code § 1303(b) — 1 case
Morgan Tire of Sacramento, Inc. v. Goodyear Tire & Rubber Co., 60 F. Supp. 3d 1109 (E.D. Cal. 2014). ““A ‘course of dealing’ is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.”
— Cal. Commercial Code § 1303(d) — 2 cases
Morgan Tire of Sacramento, Inc. v. Goodyear Tire & Rubber Co., 60 F. Supp. 3d 1109 (E.D. Cal. 2014). ““A ‘course of dealing’ is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.”
Ample Bright Dev., Ltd. v. Comis Int'l, 913 F. Supp. 2d 925 (C.D. Cal. 2012). “, § 1 — 303(d) (providing that a course of performance or course of dealing between the parties “is relevant in ascertaining the meaning of the parties’ agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the…”
— Cal. Commercial Code § 1303(f) — 3 cases
Lennar Mare Island, LLC v. Steadfast Ins., 176 F. Supp. 3d 949 (E.D. Cal. 2016). “” Cal. Com. Code § 1303 (a). It exists if both (1) the parties’ agreement “involves repeated occasions for performance” by one of them and (2) the other has “knowledge of the nature of the performance and opportunity for objection to it” but “accepts the performance or…”
Ample Bright Dev., Ltd. v. Comis Int'l, 913 F. Supp. 2d 925 (C.D. Cal. 2012). “, § 1 — 303(d) (providing that a course of performance or course of dealing between the parties “is relevant in ascertaining the meaning of the parties’ agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the…”
Seaton Ins. v. Yosemite Ins., 748 F. Supp. 2d 139 (D.R.I. 2010). “Seaton does not argue that this is a UCC case, or that Seaton can satisfy the requirements of § 2209 of California’s Commercial Code, which must be met to demonstrate modification of contractual terms that contradict the course of performance.”
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