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40 Cards in this Set

  • Front
  • Back
Express warranties are made when
a seller or lessor affirms that the goods he/she is selling meet certain standards of quality, description, or condition
Is there a specified form for express warranties?
No. CAn be oral, written, or inferred by seller's conduct.
Are there any formal wording requirements?
No don't have to use formal terms such as warrant or guarantee.
An express warranty is created when a seller or lessor indicates that the goods will conform to:
1. All affirmations of fact or promise made about the goods.
2. Any description of the goods.
3. Any model or sample of the goods.
All affirmations of fact or promise made about the goods example:
Promises are statements such as "this car will go 100 mph." or "This house paint will last at least 5 years"
Any description of the goods example
Descriptions of goods include terms such as Idaho potatoes and Michigan cherries.
Any model or sample of the goods
A model of an oil-drilling rig or a sample of wheat taken from a silo creates an express warranty.
Basis of the bargain
Buyers and lessees can recover for a breach of an express warranty if the warranty was a contributing factor -not necessarily the sole factor- that induced the buyer to purchase the product.
Is a retailer liable for express warranties made by manufacture of goods?
Not usually
Puffing
Puffing is a statement of opinion.
Puffing
A commendation of goods made by a seller or lessor, that does not create an express warranty
Example of puffing
A used car salesperson's saying "This is the best used car available in town" does not create an express warranty because it is an opinion and mere puffing. However, a statement such as "this car has only been driven 20,000 miles" is an express warranty because it is a statement of fact.
Another example of puffing
Statements such as this painting is worth a fortune or others would gladly pay 20,000 for this car do not create an express warranty because these are statements of value and not statements of fact.
Implied warranty of merchantability
Unless properly disclosed, a warranty that is implied that sold or leased goods are fit for the ordinary purpose for which they are sold or leased, as well as other assurances.
What are the standards implied warranty requires?
1. The goods must be fit for the ordinary purposes for which they are used.
2. The goods must be adequately contained, packaged, and labeled.
3. The gods must be of an even kind, quality, and quantity within each unit.
4. The goods must be capable of being used safely in accordance with the instructions on the package or label.
5. The quality of the goods must pass without objection in the trade.
6. Fungible goods must meet a fair average or middle range of quality
The goods must be fit for the ordinary purposes for which they are used. Example
A chair must be able to safely perform the function of a chair. If a normal sized person sits in a chair that has not been tampered with, and the chair collapses, there has been a breach of implied warranty. If it is being used as a ladder and colapses no breach of warranty because being a ladder is not an implied use of a chair.
The goods must be adequately contained, packaged, and labeled. Example
The implied warranty of merchantability applies to a milk bottle as well as to the milk inside the bottle.
The goods must be of an even kind, quality, and quantity in each unit. Example.
All the goods in a carton, package, or box must be consistent.
The goods must conform to any promise or affirmation of fact made on the container or label. Example
The goods must be capable of being used safely in accordance with the instructions on the container or label.
The quality of the goods must pass without objection in the trade. Example
Oher users of the gods would not object to the quality of the goods.
Fungible goods must meet a fair average or middle range of quality. Example
To be clasisfied as a certain grade iron ore must meet average range of quality for that grade.
Implied warranty of merchantability does it apply to casual sales? Example
NO.
Implied warranty aplies to sale of a lawn mower by a merchant who is in the business of selling mowers. Does not apply when you sell your mower to your neighbor.
Implied warranty of fitness for human consumption
A warranty that applies to food or drink consumed on or off the premises of restaurants, grocery stores, fast food outlets, and vending machines.
What are the 2 tests the state uses to determine breach of implied warranty of fitness for human consumption?
1. Foreign substance test
2. Consumer expectation test.
Foreign substance test. And example
Under this test a food is not merchantable if a foreign object in it would cause injury
Implied warranty breached if nail in cherry pie.
Implied warranty not breached by cherry pit in cherry pie because not foreign substance.
Consumer expectation test and example
Under this test the court asks what a consumer would expect to find or not find in food or drink that they consume.
Warranty breached if a person injured by bone eating chicken salad sandwich because they would have expected the food producer would have removed bones.
Not breached if injured by bone eating friend chicken because bones should be expected.
Implied warranty of fitness for a particular purpose
A warranty that arises where a seller or lessor warrants that the goods will meet the buyer's or lessee's expressed needs.
The warranty of fitness for particular purpose is implied at time of contracting if:
1. Seller has reason to know the particular purpose for which the buyer is purchasing the goods.
2. Seller makes a statement that the goods will serve this purpose.
3. Buyer relies on seller's skill and judgement and purchases or leases the goods.
Example of implied warranty of fitness for particular purpose
Susan wants to buy lumber to build deck. Goes to Joe's lumber yard and tells joe what she intends to build. Tells joe she is relying on him to select the right wood. Joe selects lumber and tells susan it's appropriate. Susan buys and builds. Deck collapses. Susan can sue joe for breach of implied warranty of fitness for particular purpose.
Warranty disclaimer
A statement that negates express and implied warranties.
What are the rules for disclaiming implied warranties?
1. As is disclaimer
2. Disclaimer of the implied warranty of merchantability
3. Disclaimer of the implied warranty of fitness for a particular use.
as is disclaimer
Expressions such as as is, with all faults, or other language that makes it clear to the buyer that there are no implied warranties and disclaims all implied warranties.
Disclaimer of implied warranty of merchantability
If the as is is not used must be specifically mentioned. Either orally or in writing.
Disclaimer of implied warranty of fitness for a particular use.
If as is is not used may be disclaimed in general language without specific use of the term fitness. Disclaimer has to be in writing.
Warranty of good title
A warranty in which the seller warrants that he or she has valid title to the goods being sod and that the transfer of the title is rightful.
Example of warranty of good title
A thief steals crane and sells it to another const. co. who doesn't know it's stolen. If original owner discovers the new co. has the crane they can reclaim it. The new owner can recover against the thief for breach of warranty of title.
Warranty of no security interests
A warranty in which sellers of goods warrant that the goods they sell are delivered free from any third-party security interests, liens, or encumbrances that are unknown to the buyer.
Warranty against infringements
An automatic warranty of a seller or lessor who is a merchant who regularly deals in goods of the kind sold or leased which warrants that the goods are delivered free of any third-party patent, trademark, or copyright claim.
Example of warranty against infringement
Adams co manufactures a shoe making machine. SElls machine to shoe manufacturer. Nedette claims she has patent on machine. Proves her patent and shoe manufacturer can no longer use machine without paying Nerdette. The shoe manufacture can rescind contract with adams co because breach of infringement
Warranty against interference
A warranty in which the lessor warrants that no person holds a claim or an interest in the gods that arose from an act or omission of the lessor that will interfere with the lessee's enjoyment of his/her interest.