Warranty (Express, Implied, Disclaimer)
In commercial sales, a seller's promise about the quality, condition, performance, or characteristics of goods. UCC Article 2 recognizes both express warranties (created by seller statements) and implied warranties (arising by operation of law). Implied warranties can be disclaimed with specific language. Express warranties are much harder to negate.
A warranty in commercial sales is a seller's promise about the quality, condition, performance, or characteristics of goods. UCC Article 2 recognizes both express warranties (created by seller statements or actions) and implied warranties (arising by operation of law). Implied warranties can be disclaimed with specific language. A disclaimer that conflicts with an express warranty is inoperative to the extent it cannot reasonably be read as consistent with it (§ 2.316(a)).
Express warranty (§ 2.313)
Created by (1) any affirmation of fact or promise by the seller relating to the goods that becomes part of the basis of the bargain; (2) any description of the goods that becomes part of the basis of the bargain; or (3) any sample or model that becomes part of the basis of the bargain. Use of "warrant" or "guarantee" is not required. An affirmation merely of the value of the goods, or a statement of the seller's opinion or commendation, does not create a warranty (§ 2.313(b)).
Implied warranty of merchantability (§ 2.314)
Arises in any transaction where the seller is a merchant with respect to the goods sold. To be merchantable, goods must at least (1) pass without objection in the trade under the contract description, (2) if fungible, be of fair average quality within the description, (3) be fit for the ordinary purposes for which such goods are used, (4) run of even kind, quality and quantity within the variations the agreement permits, (5) be adequately contained, packaged and labeled as the agreement may require, and (6) conform to any promises or affirmations of fact on the container or label. Most ordinary commercial goods sales include this implied warranty unless effectively disclaimed.
Implied warranty of fitness for particular purpose (§ 2.315)
Arises when the seller, at the time of contracting, has reason to know (1) the buyer's particular purpose for the goods, and (2) that the buyer is relying on the seller's skill or judgment to select suitable goods. Buyer must in fact rely.
Disclaimer (§ 2.316)
Merchantability may be disclaimed by language mentioning "merchantability", and if in writing, must be conspicuous. Fitness may be disclaimed by general written language ("There are no warranties which extend beyond the description on the face hereof"), conspicuous. Unless the circumstances indicate otherwise, implied warranties are excluded by expressions like "as is," "with all faults," or similar language. Where the buyer, before contracting, examined the goods as fully as it desired or refused to examine them, there is no implied warranty as to defects an examination ought in the circumstances to have revealed.
"Conspicuous" means so written, displayed, or presented that "a reasonable person against which it is to operate ought to have noticed it," and whether a term is conspicuous is a decision for the court (§ 1.201(b)(10)). The statute gives examples, such as a heading in capitals or language in larger or contrasting type. Under § 2.316(b), a written disclaimer of merchantability, or any disclaimer of fitness, must be conspicuous.
Companion article: Contract Disputes in Texas