Nonetheless, there are rules pertaining to the method of disclaiming warranties in relation to the type of warranties, which can be express or implied. Express warranties are found in statements made by sellers.
Examples of this type of warranties include:. Any statement describing a product or influencing a buyer's decision to complete the transaction can be considered a form of warranty, even if the creation of the warranty is not intentional.
A seller can easily disclaim express warranties by including statements in brochures, samples, and models stating that no warranty exists. In addition, salesmen should be cautious not to make verbal promises without a disclaimer. In a sales contract , an express warranty can be disclaimed by a statement that excludes an express warranty. Are You a Lawyer?
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According to Uniform Commercial Code , a seller can create an express warranty in three ways:. However, if a seller is simply expressing his or her opinion of the goods, there is no promise or warranty. Implied warranties are those created by the Uniform Commercial Code rather than a particular manufacturer or seller. There are two categories of implied warranty: warranty of merchantability and warranty of fitness.
An implied warranty of merchantability does not apply to all sales. As above and detailed below, a seller can exclude or modify a warranty of fitness as allowed by law. The standard for disclaiming an implied warranty depends upon the type of warranty. Generally, express language must be used to disclaim the implied warranty or title. In some instances, however, the implied warranty is disclaimed when the buyer knows or has reason to know that the seller is only attempting to sell her rights whatever their extent in the good.
This often arises in transfers of inheritance rights in goods that are contested or uncertain. As discussed above, the implied warranty of merchantability applies to goods sold by merchants. To disclaim the implied warranty of merchantability, the contract must expressly use the word merchantability in the disclaimer. The written disclaimer must also be conspicuous such as capitalized or in bold to the reader. The disclaimer of the implied warranty of fitness must be in writing and conspicuous in the contract of sale.
Unlike the warranty of merchantability, however, a general disclaimer stating that no warranties other than express warranties apply is generally sufficient to disclaim this warranty.
Example : Wilt, a merchant, enters into a contract to sell Aaron equipment. Wilt is not certain about the quality of the equipment and all of the equipment is subject to a lien by a third-party lender. Aaron is willing to take the risk. In the contract, Wilt expressly states that there are no warranties and, specifically, that there is no warranty of merchantability.
He also discloses the third-party lenders lien on the equipment. The contract states that the proceeds from sale will be used to pay off this lien at the time of purchase. The general disclaimer and specific disclaimer together are sufficient to disclaim the implied warranty of merchantability and fitness. The disclosure of the lien is sufficient to disclaim the implied warranty of title and also creates an obligation under the contract.
Note: Implied warranties can arise or be further excluded by a course of dealing, course of performance, or trade usage. A general disclaimer attempts to disclaim all possible warranties in the sale of a good. Using specific words of disclaimer, such as as is or with all faults, serves to disclaim the implied warranties of fitness and any other implied warranties with the exception of the implied warrant of merchantability. These words must appear conspicuously in the contract.
If the buyer is given the right to examine the goods prior to purchase or has refused to examine the goods, then there is no implied warranty for defects that should have been discovered on examination.
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