1
an affirmation of fact or promise to
the buyer that relates to the goods and
becomes the basis of the bargain." The
express warranty is that the goods will
conform to the affirmation or promise.
The seller can also create express warranties by providing a description of
the goods. 3 The description need not
be in writing; technical specifications,
Seller Beware!
What Manufacturers Should Know
About Consumer Warranty Law
By Randy T. Moore and Ryan P. Ruggerello, Sn;ll & Wilmer L.L.P.
C
aveat emptor (Latin for "let
the buyer beware") once
stood as the guiding principle for those who bought and sold
goods. But this maxim has long since
given way to modern contract law
that is designed to prevent the harsh
consequences to purchasers of defective or substandard goods, most of
whom are less knowledgeable - and
less sophisticated - than the sellers of
the goods in question. More recently,
consumer warranty laws, sometimes
called "lemon laws," have sought to
provide further protection for consumers by imposing additional obligations on manufacturers and sellers
of consumer goods while providing
broad remedies to those who purchase them. These laws are intended
to "improve the adequacy of information available to consumers, prevent
deception, and improve competition
and the marketing of consumer products."! While the salutary purposes
of these laws are laudable, they can
present traps for the unwary manufacturer or seller and impose liability'
on them that far exceeds the cost of
the product itself. Moreover, a poorlyhandled warranty claim can result in
a loss of customer confidence or satisfaction, which, in turn, can lead to a
loss of goodwill and the loss of market
share. Consequently, a manufacturer
or seller of consumer products must
have an understanding of consumer
protection laws and be able to address
claims that might arise under these
10
laws in a prompt, efficient and costeffective manner. This article, which
is the third in a five-part series, is intended to provide recreational boat
and equipment manufacturers with a
basic understanding of consumer warranty law and practical advice on how
to minimize liability for warranty
claims.
ment purporting to be merely the seller's opinion or commendation of the
goods (sometimes called "puffery")
does not create a warranty." There
usually is no clear line between an affirmation of fact and puffery; the issue
will be left to the jury to decide based
on all of the circumstances of the purchase transaction."
undertakes to preserve or maintain
the utility or performance of the consumer goods or provide compensation
if there is a failure in utility or performance of the product." Thus, while
the boat advertising brochure referred
to above resulted in an express warranty under the UCc, it was held not
to have created an express warranty
ments, by Magnuson-Moss. Together,
these statutory schemes establish the
rights and obligations of sellers and
buyers involved in the sale of consumer products, including express and
implied warranties, and remedies that
are available for the breach ~f these
warranties.
Express warranties
An overview of consumer warranty
law
There are three primary sources of
warranty law: (1) the Uniform Commercial Code (UCC), (2) the federal
Magnuson-Moss Warranty Act (Magnuson-Moss), and (3) state consumer
warranty statutes, which might be
referred to as "lemon laws." Warranties for the sale of goods are basically
and most broadly covered in Article 2
of the Ucc. Notwithstanding subtle
differences from one state to another,
the UCC is intended to simplify the
law governing commercial transactions and make it uniform among all
jurisdictions. The UCC is amplified
in certain substantive ways as to consumer sales by state consumer warranty legislation, such as California's
Song-Beverly Consumer Warranty
Act (Song-Beverly). Consumer-specific warranty statutes impose additional
obligations on sellers and provide consumers with broader remedies against
a wider range of possible defendants.
Consumer protection for the sale of
consumer goods is further extended,
primarily through disclosure require-
As a general rule, there is no law
that requires manufacturers of consumer products to provide an express
warranty with the sale of their product. But few manufacturers would
stay in business if they did not stand
behind their products with an express
warranty. Indeed, express warranties
on consumer products have become
a primary sales and marketing tool as
manufacturers and sellers compete for
market share by offering warranties
that last longer and provide broader
coverage.
Once a manufacturer offers an express warranty, federal and state consumer warranty laws apply and govern
virtually every aspect of it, including
its creation, its acceptable form, its
duration, and the manufacturer's
duties regarding disclosure of information about and compliance with
the warranty. These laws also create
the remedies that a consumer has for
the breach of a warranty or failure to
comply with consumer warranty legislation.
Under the UCC, an express warranty is created when the seller makes
the Reference Point
such as blueprints or design drawings, can result in warranties if they
are made the basis of the bargain." A
sample or model of the product that
is offered for inspection may also create a warranty that the actual product
will conform to the sample or model.'
To create an express warranty the
seller does not need to use formal
words such as "warrant" or "guarantee." 6 Nor is it necessary that the
seller have a specific intention to make
a warranty'? For example, statements
in an advertising brochure that a boat
was "a pictureof sure-footed seaworthiness" and "a carefully equipped
and very seaworthy vessel" were spe. cific and unequivocal enough to create warranties under the UCC.S On
the other hand, an affirmation merely
of the value of the goods or a statewww.abycinc.org
A buyer also does not need to
demonstrate his or her reliance on the
warranty in order to assert a claim
for its breach. The basis of the bargain requirement means only that
the affirmation, description, model or
sample was a factor or a consideration
in inducing the buyer to purchase the
good. ll Warranty statements by the
seller are presumptively part of the basis of the bargain, and it is up to the
seller to prove otherwise."
Most state statutory schemes, including Song-Beverly, are limited in
their scope to sales of consumer goods
(i.e., a product that is used, bought or
leased primarily for personal, family,
or household purposes)." Song-Beverly also limits its coverage to a single
type of transaction - one in which the
manufacturer, distributor or retailer
under Song-Beverly because the statements could not be construed as an
undertaking by the seller to preserve
or maintain the utility or performance
of the boat." Song-Beverly is broader
than the DCC in the scope of its protection, however, by not requiring
that the express warranty be made the
basis of the bargain and by providing
that the warranty may be made by the
manufacturer or distributor and not
just by the seller."
Once an express warranty is created under state consumer warranty
legislation, special obligations are imposed on the manufacturer, distributor and seller. For example, under
Song-Beverly, the manufacturer must
provide service and repair facilities in
California that are reasonably close to
all areas where its consumer goods an!
an affirma tion of fact or promise to
Seller Beware!
What Manufacturers Should Know
About Consumer Warranty Law
C
laws in a prompt, efficient and costeffective manner. This article, which
is the th ird in a five-part series, is intended to provide recreati onal boat
and equipment manufacture rs with a
basic understanding of cons umer warranty law and practical advice on how
to m inimize liability for warra nty
claims.
such as blueprints or design dr awings, can result in warranties if th ey
are made the basis of th e bargain." A
sam ple or model of th e product th at
is offered for inspect ion may also create a warra nty th at the actu al product
will conform to the sample or model."
To create an exp ress wa rranty th e
seller does not need to use form al
word s such as "wa rrant" or "gua rantee, " 6 Nor is it necessary that the
seller have a specific int ention to make
a warranty'? For example, statements
in an adver tising brochure that a boat
was "a pictu reof sure-foo ted seaworth iness" and "a carefully equipped
and very seawort hy vessel" were spe. cific and unequivocal eno ugh to create warranties under the VCC.8 On
the other hand, an affirma tion merely
of th e value of the goo ds or a state-
A buyer also doe s not need to
demonstrate his or her relian ce on the
warranty in order to assert a claim
for its breach. The basis of the bargain requ irem ent mean s only that
the affirm ation , description , model or
sample was a factor or a consideration
in inducing the buyer to purchase the
good." Warranty statements by the
seller are presumptively part of the basis of the bargain, and it is up to the
seller to prove otherwisc.F
Most state stat utory schemes, including So ng-Beverly, are lim ited in
th eir scope to sales of con sumer goods
(i.e., a produ ct th atis used , bought or
leased prim arily for per son al, family,
or hou sehold purposes)." Song- Beverly also limi ts its coverage to a single
type of tran saction - on e in which the
manufacturer, distributor or retailer
under Song-B everly becau se the statements could not be construed as an
the buyer that relates to the goods and
becomes the basis of th e bargain.i Th e
expr ess warra nty is th at th e goo ds will
conform to th e affirmation or promise.
Th e seller can also creat e express wa rranties by providing a description of
th e goods.' The description ' need no t
By Randy T. Mooreand Ryan P. Ruggerello, Sn;ll & Wilmer L.L.P.
aveat emptor (Latin for "let
the buyer beware") once
stood as th e guiding principle for those who bought and sold
goods. But this maxim has long sinc e
given way to modern cont ract law
th at is designed to prevent the harsh
con sequ erices to purchasers of defective or substanda rd goo ds, mo st of
whom are less knowledgeable - and
less sophisticated - th an the sellers of
the good s in question. More recently,
con sumer warranty laws, sometimes
called "lemon laws," have sought to
provide furt her protection for consu mers by imposing add itional obligatio ns on manufactu rers and sellers
of consumer good s while providing
broad remedies to those who pu rcha se them. These laws are intended
to "imp rove the adequacy ofinformation available to co nsumers, prevent
deception, and improve competition
and th e marketing of consumer products."! While the salutary purposes
of th ese laws are laudable, the y can
present traps for th e un wary manufacturer or seller and impose liabil ity'
on th em that far exceeds the cost of
the product itself. M oreover, a poorlyhandled wa rrant y claim can result in
a loss of customer confidence or satisfactio n, wh ich, in tu rn , can lead to a
loss of goodwill and the loss ofmarket
share . Co nsequently, a manufacturer
or seller of consumer products must
have an understanding of consumer
protection laws and be able to address
claim s that might arise under the se
undertakes to pr eserve or ma intain
th e utility or performance of th e consu mer goods or provide compensation
if there is a failure in utility or performan ce of th e product. 14 Thus, wh ile
be in wri ting; technical speci ficatio ns,
ment purporting to be m erely the seller's opinion or commendation of the
goods (som etimes called "puffery")
doe s not create a warranty," Th ere
usuall y is no clear line bet ween an affirm ation of fact and puffery; the issue
will be left to th e jury to decide based
on all of th e circumstances of th e purchase tran saction ."
th e boat adver tising broch ure referred
to above result ed in an expr ess wa rranty under th e V CC, it was held not
to have created an express warranty
ments, by M agnuson-Moss. Together,
these statutory schem es establish the
rights and obl igation s of sellers and
buyers involved in the sale of consumer products, including express and
implied wa rrant ies, and remedies that
are available for the brea ch of th ese
warrant ies.
Express warranties
An overview of consumer warranty
law
Th ere are three primary sources of
warranty law: (1) the Uniform Commer cial Co de (UC C), (2) th e federal
M agnuson-Moss W arr anty Act (Magnuson-M oss), and (3) state consumer
warranty statutes, wh ich m ight be
referred to as "lemon laws." Warranties for th e sale of goods are basically
and mo st broadly covered in Article 2
of the UC c. Notwithstanding subtle
differ ences from one state to another,
the U C C is intended to simplify th e
law govern ing commercial tr an saction s and m ake it uniform amo ng all
jur isdic tions. The UC C is amplified
in cert ain substantive ways as to consumer sales by state consume r warranty legislation, such as Ca liforn ia's
Song-Beverly Consumer Wa rrant y
Act (Song-Beverly). Consumer-specific wa rra nty sta tu tes impose add itiona l
obligation s on sellers and provide consum ers with broader remedie s agai nst
a wider ran ge of po ssible defend ants.
C onsumer prot ecti on for the sale of
consumer goods is further extended,
primarily through disclosur e require-
As a gener al rule, there is no law
th at requires m anufacturers of consumer products to provide an express
warranty with the sale of their product. But few ma nufact urer s wo uld
stay in bu siness if they did no t sta nd
beh ind thei r products w ith an express
wa rranty. Indeed , express warranties
on consumer products have becom e
a primary sales and marketing tool as
manufacturers and sellers compete for
market share by offering warrant ies
that last longer and provide broader
coverage.
Once a manufacturer offers an express warra nty, federal and state consumer warranty laws apply and govern
virtually every aspect of it, includ ing
its creation, its acceptable form , its
duration, and the manufacturer's
duties regarding disclosure of inform ation abou t and complian ce with
th e warra nty. These laws also create
th e remedies th at a consum er has for
th e breach of a warranty or failure to
comply with con sumer wa rra nty legislation.
Under the VCC, an express warranty is created when the seller ma kes
the Reference Point
www .abycinc.otg
undertaking by th e seller to preserve
or ma int ain th e utility or perform an ce
of the boar." Son g-Beverly is broader
th an the D CC in th e scope of its protection , however, by not requiring
th at the expr ess warranty be made the
basis of th e bargain and by providing
that th e wa rra nty may be m ade by th e
m anufacturer or distributor and not
just by the seller."
Once an express warrant y is created under state consume r warranty
legislation , specia l obligations are imposed on th e manufacturer, d istributor and seller. For example, under
Song- Beverly, the ma nufacturer must
provide service and repair facilities in
Ca liforn ia th at are reasonably close to
all areas where its consumer good s are
11
- ' .'
sold in order to carry out the terms of
the warranty. I? Alternatively, the manufacturer may designate and authorize
independently-owned and operated
service and repair facilities in California to handle warranty claims." The
Act provides further requirements for
manufacturers who enter into warranty service contracts with independent
service and repair facilities.'?
Song-Beverly also imposes a duty
on the manufacturer or its authorized
representative to begin service and
repairs to conform the product to its
warranty within a reasonable period
of time." Unless the buyer agrees in
writing, California law requires that
the goods be conformed to the warranty within 30 days." Delay caused
by conditions beyond the manufacturer's or representative's control will
extend the' 3D-day requirement. But
the manufacturer or its representative
remains obligated to tender conforming goods as soon as the condition
causing the delay has ended. 22 If the
manufacturer or its authorized dealer
cannot conform the goods to the warranty in a reasonable period of time,
or within a reasonable number of repair attempts, the manufacturer has a
further obligation to either replace the
goods or reimburse the buyer in an
amount equal to the purchase price,
less an amount directly attributable to
use by the buyer before discovery of
the nonconforrnity."
Magnuson-Moss further regulates
written warranties on consumer products and establishes consumer remedies. One of its primary purposes is
to require any warrantor to fully and
conspicuously disclose in simple and
readily understood language the terms
and conditions of the warranry.P Thc
Act accomplishes this goal primarily
through regulations that are promulgated by the Federal Trade Commission (FTC) and published in the
Code of Federal Regulations. 25 These
regulations impose a host of specific
duties on manufacturers of consumer
products, including a duty to provide
sellers with warranty materials that
are necessary to make the text of the
warranty readily available for examination by the prospective buyer."
Magnuson-Moss also attempts to
encourage the fair and expeditious
private settlement of consumer disputes by allowing warrantors to set
up informal dispute settlement procedures that meet FTC requirements."
Manufacturers who wish to avail
themselves of these informal dispute
resolution procedures must follow
elaborate guidelines established by the
FTC. 28 When an informal dispute
resolution procedure is effectively incorporated into a written warranty, it
can serve as a prerequisite to the filing
of a lawsuit under the Act. 29
Implied warranties
An implied warranty, unlike the contrac-
tual express warranty,
arises by operation of
law. A manufacturer's
or seller's liability for
an implied warranty
does not depend on its
specific conduct or promises. It turns instead on whether
12
the product is merchantable or fit as
required under the applicable warranty laws.
The warranty of merchantability is
the most common implied warranty.
Under the UCC, a warranty that the
goods are merchantable is implied in
a contract for their sale if (1) the seller
is a merchant of goods of that kind,
and (2) the warranty has not otherwise been excluded or modified.:"
"Merchantable" means that the goods
will: (1) pass without objection in the
trade under the contract description;
(2) be of fair average quality within
the description, if they are fungible
goods; (3) be fit for the ordinary purposes for which they are used; (4) run
of even kind, quality and quantity
within each unit and among all units
involved; (5) be adequately contained,
packaged and labeled as the agreement
may require; and (6) conform to the
promises or affirmations of fact made
on the container or label, if any."
In California, the implied warranty of merchantability is similar to that
provided by the UCC, but extends its
coverage for consumer goods to the
manufacturer as well as the seller.32 It
also provides a provision by which the
seller can obtain indemnity against
the manufacturer. 33
The implied warranty of fitness for
a particular purpose arises if the seller
at the time of contracting has reason
to know of any particular purpose for
which the goods are intended and the
buyer is relying on the seller's skill or
judgment to select or furnish suitable
goods. 34 A "particular purpose" differs
from an "ordinary" one in that it envisions a specific use by the buyer which
is peculiar to the nature of his or her
needs. For example, the ordinary purpose of an outboard engine is to propel a boat through water, but the seller
may know that a particular boat and
outboard are being selected for use in
the Reference Point
saltwater. Under these circumstances,
the seller's skill or judgment in selecting an appropriate outboard engine
for saltwater applications may result
in a warranty of fitness for that par-
ample, the implied warranty of merchantability and fitness is co-extensive
with any express warranty that accompanies the consumer goods, provided
the duration is reasonable. 4D But the
ticular purpose."
Implied warranties can be waived
or disclaimed under federal and state
law. Under Song-Beverly, however,
these warranties can only be waived
on an "as-is" or "with all faults" basis." Thus, neither the manufacturer,
distributor, nor retailer can disclaim
implied warranties in any sale of
consumer goods that carry express
warranties. Moreover, any disclaimer
of an implied warranty must strictly
comply with the provisions of the
Act." Magnuson-Moss extends the
prohibition against waiver of implied
warranties to consumer transactions
that include service contracts." It
also requires that any such limitation
be conscionable and provides specific
disclosure requirernents.?"
State consumer warranty statutes
often establish the duration of an implied warranty. In California, for ex-
Act further provides that implied warranty may not be less than 60 days nor
more than one year following the sale
of the product."
Footnotes
1
2
3
4
S
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
15 C.S,C § 230;t (rules governing
cottrems of warranrics).
DCC § 2-3Li,
Id.
Comment 5,10 UCC § 2-313,
UCC § 2.-313. "
Id.
Id,
Keith v. Buchanan (1985) 173 CaL App.
3d 13, 23-24,
UCG.§ 2 -31.'\.
.Kazerouni v. De Satnick (1991) 125 Cal.
App, 4th 949,959.
Keith Yo Buchanah.supra'(1985) 173
Cal. App, 3d at?3.
Id.
Ca l.Civ.Code § 1791(a).
Cal. Clv. Code § 1791.2(a)(I).
Keith v, Buchana n, s"pra (1985) 173
Cal. App.3d ar 20-n.
Cal. Civ Code § 1791,2(.)(1); cf. uec
§ 2-313,
Cal. C\'. Code§ 1793,3(0).
Id,
ld.
Cal ci-, Code § lI'93,2(b),
www.abycinc.org
Consumer remedies
The heart ofany consumer warran-
ty legislation is the remedies that it affords consumers against manufacturers or sellers who do not comply with
their warranty obligations. Under
Song-Beverly, the measure of the consumer's damages includes his or her
rights of replacement ofthe product or
reimbursement of its purchase price,
less any amount attributable to prior
use. 42 In addition, if the buyer establishes that the failure to comply with
the Act was willful, he or she may be
entitled to recover a civil penalty that
may be as high as twice the amount
of the buyer's actual damages.P The
"willful" standard is not as onerous as
21
22
23
24
25
ld.
Id,
Cal. Civ. Code§ l i'93.2(d)(I).
15 U.S,c. § 2302,
16 CF,R, § 701.3 (written warranty
terms),
it may seem; the term simply means
that the illegal act or omission (e.g.,
failure to timely conform the product
to its warranty) occurred intentionally
without regard to motive or ignorance
of the Act's prohibitive character. The
Act also allows a buyer who prevails
in proving a violation of Song- Beverly
to recover reasonable attorneys' fees
and costs, including expert wirness
fees.44 This is largely a unilateral right;
there is no corresponding right for the
manufacturer or seller to recover its
attorney's fees if it prevails at trial.
As a general rule, the remedies provided by a state consumer protection
act are cumulative and are not construed as restricting any remedy that
is otherwise available. This approach
reflects the strong legislative policy toward providing maximum protection
to consumers. Consequently, recreational boat and equipment manufacturers who seek to minimize warranty
liability and related costs - while
maximizing customer satisfaction should implement a comprehensive,
systematic and proactive program for
managing warranty claims. In the
next article, we will provide specific
recommendations that should be incorporated into any such warranty
program.
'"
.0
2616 C ,F,R, §~ 70n to 702.3 (pre-sale
availability 01
warranty tetms).
21 15 U.S, c. § 2310 (d)(l).
28 16 CF,R, §§ 703.1-703.8.
29 15 U. S.C § 2310 (d)(l).
30 UCG.§ 2"314,
31 Id.
32 Cal. Clv, Code § 1792.
33 Id.
34 UCG.§ 2315.
35 See, e.g., Comment 2 to li C C § 2-315,
36" Cal. Clv.Code § 1792,3.
37 Id .
38 15 U.S.C. § 2308(.),
39 Id.
40 Cal. Civ. Code § 1791.1(c).
41 rd.
. 42 Ca l. Cl\'. Cone § 1794,
43 Id.
44 Id.
About the Authors: Randy Moore is
a partner in the Orange County, Calif.,
office of Snell & Wilmer L.L.P. and a
member of its Product Liability and
Commercial Litigation Groups. Ryan
Ruggerello is an attorney at Snell &
Wilmer and is a member ofits Product
Liability Group. Their practice is fOcused on product liability and consumer
warranty law. For more infOrmation or
answers to questions on product liability
or warranty law, please contact Randy
at (714) 427-7007 (rmoore@swlaw.
com) or Ryan at (714) 427-7482 (rrug•
gerello@swlaw.com).
sold in order to carry out the terms of
the warranty. I? Alternatively, the man-
use by the buyer before discovery of
the nonconformity. 23
ufacturer may designate and authorize
independently-owned and operated
service and repair facilities in Califor-
Magnuson-Moss further regulates
written warranties on consumer products and establishes consumer rem-
nia to handle warranty claims." The
Act provides further requirements for
manufacturers who enter into warranty service contracts with independent
service and repair facilities.'?
edies. One of its primary purposes is
to require any warrantor to fully and
conspicuously disclose in simple and
readily understood language the terms
and conditions of the warranty." The
Song-Beverly also imposes a duty
on the manufacturer or its authorized
representative to begin service and
repairs to conform the product to its
warranty within a reasonable period
of time." Unless the buyer agrees in
writing, California law requires that
the goods be conformed to the warranty within 30 days." Delay caused
by conditions beyond the manufacturer's or representative's control will
extend the' 30-day requirement. But
the manufacturer or its representative
remains obligated to tender conforming goods as soon as the condition
causing the delay has ended.F If the
manufacturer or its authorized dealer
cannot conform the goods to the warranty in a reasonable period of time,
or within a reasonable number of repair attempts, the manufacturer has a
further obligation to either replace the
goods or reimburse the buyer in an
amount equal to the purchase price,
less an amount directly attributable to
Act accomplishes this goal primarily
through regulations that are promulgated by the Federal Trade Commission (FTC) and published in the
Code of Federal Regulations." These
regulations impose a host of specific
duties on manufacturers of consumer
products, including a duty to provide
sellers with warranty materials that
are necessary to make the text of the
warranty readily available for examination by the prospective buyer. 26
Magnuson-Moss also attempts to
encourage the fair and expeditious
private settlement of consumer disputes by allowing warrantors to set
up informal dispute settlement procedures that meet FTC requirements."
Manufacturers who wish to avail
themselves of these informal dispute
resolution procedures must follow
elaborate guidelines established by the
FTC. 28 When an informal dispute
resolution procedure is effectively incorporated into a written warranty, it
can serve as a prerequisite to the filing
of a lawsuit under the Act. 29
Implied warranties
An implied warranty, unlike the contractual express warranty,
arises by operation of
law. A manufacturer's
or seller's liability for
an implied warranty
does not depend on its
specific conduct or promises. It turns instead on whether
the product is merchantable or fit as
required under the applicable warranty laws.
The warranty of merchantability is
the most common implied warranty.
Under the UCC, a warranty that the
goods are merchantable is implied in
a contract for their sale if (1) the seller
is a merchant of goods of that kind,
and (2) the warranty has not otherwise been excluded or modified. 30
"Merchantable" means that the goods
will: (1) pass without objection in the
trade under the contract description;
(2) be of fair average quality within
the description, if they are fungible
goods; (3) be fit for the ordinary purposes for which they are used; (4) run
of even kind, quality and quantity
within each unit and among all units
involved; (5) be adequately contained,
packaged and labeled as the agreement
may require; and (6) conform to the
promises or affirmations of fact made
on the container or label, if any."
In California, the implied warranty of merchantability is similar to that
provided by the UCc, but extends its
coverage for consumer goods to the
manufacturer as well as the seller." It
also provides a provision by which the
seller can obtain indemnity against
the manufacturer.P
The implied warranty of fitness for
a particular purpose arises if the seller
at the time of contracting has reason
to know of any particular purpose for
which the goods are intended and the
buyer is relying on the seller's skill or
judgment to select or furnish suitable
goods. 34 A "particular purpose" differs
from an "ordinary" one in that it envisions a specific use by the buyer which
is peculiar to the nature of his or her
needs. For example, the ordinary purpose of an outboard engine is to propel a boat through water, but the seller
may know that a particular boat and
outboard are being selected for use in
the Reference Point
7.•
saltwater. Under these circumstances,
the seller's skill or judgment in selecting an appropriate outboard engine
for saltwater applications may result
in a warranty of fitness for that par-
ample, the implied warranty of merchantability and fitness is co-extensive
with any express warranty that accom-
ticular purpose."
Implied warranties can be waived
or disclaimed under federal and state
law. Under Song-Beverly, however,
Act further provides that implied warranty may not be less than 60 days nor
more than one year following the sale
of the product."
these warranties can only be waived
on an "as-is" or "with all faults" basis." Thus, neither the manufacturer,
distributor, nor retailer can disclaim
implied warranties in any sale of
consumer goods that carry express
warranties. Moreover, any disclaimer
of an implied warranty must strictly
comply with the provisions of the
ActY Magnuson-Moss extends the
prohibition against waiver of implied
warranties to consumer transactions
that include service contracts. 38 It
also requires that any such limitation
be conscionable and provides specific
disclosure requirements."
State consumer warranty statutes
often establish the duration of an implied warranty. In California, for ex-
Footnotes
.1
15 ·U.S.C § 2302 (rules governing
contents of warranties).
2 VCC § 2-313.
3 ld.
4 Comment 510 VCC § 2-313 .
5VCC§2·313
6 · l d.
7
panies the consumer goods, provided
the duration is reasonable. 40 But the
Consumer remedies
The heart of any consumer warranty legislation is the remedies that it affords consumers against manufacturers or sellers who do not comply with
their warranty obligations. Under
Song-Beverly, the measure of the consumer's damages includes his or her
rights of replacement ofthe product or
reimbursement of its purchase price,
less any amount attributable to prior
use. 42 In addition, if the buyer establishes that the failure to comply with
the Act was willful, he or she may be
entitled to recover a civil penalty that
may be as high as twice the amount
of the buyer's actual damages.t? The
"willful" standard is not as onerous as
2] rd.
n
Id .
23 Ca L Clv! Code § 1793.2(d)(I).
24 15 us.c, § 2302.
251 6 C.P .R.§ 101.3 ('",dtten warranty
terms).
26 ) 6 C;F.R. §§ 702.1 to 702.3 {pre-sale
avallabiliry of
Id.
8
Keith Y. Buchanan (1985) 173 CaL App.
3d B,23-24.
9 VCC§ 2 ·3B.
10 Kazerouni v. De Satnidi(1991) 125 Cal.
App. 4th 949, 959,
U Keith v. Blidiaitan,supro (J985) 173
Cal. App . 3d at 23.
12 Id,
13 C aL ci-. Code § 1791(.) .
14 CaL Ci Y. Code § 1791.2(")(1).
15' Keithv. Buchanan, supra (1985) 173
C al. Apr. 3d at 20-22
16 Cal. Civ. Code § 1191.2(a)(I); cf. VCC
§ 2-313.
' 17 CaL Civ. Code § 1793.3(,).
18 Id,
19 Id.
20 Cal. Ciy. Code § 1793.2(b\.
www.abycinc.org
27
28
29
30
31
32
33
34
. 35
36
37
38
}')
40
41
42
43
44
wxrranry renns),
IS V.S.c. § 23 101d)(J).
16CP.R.
703.P03.8.
15 V.S.C § 2310 (d)(l).
VCC § 2-3 14.
Id:
CaL Civ. Code§ 1792.
Id.
vee § 2315.
See. e.g.. Comment 2 to VCC § 2-315.
Cal. Clv. Code § ]792.3.
ld.
15 V.S .c. § 2308(a).
ld.
ss
CaL Civ, Code § 1791.1(c).
Id,
Cal. Civ. Code § 1794.
Id.
Id,
it may seem; the term simply means
that the illegal act or omission (e.g.,
failure to timely conform the product
to its warranty) occurred intentionally
without regard to motive or ignorance
of the Act's prohibitive character. The
Act also allows a buyer who prevails
in proving a violation of Song- Beverly
to recover reasonable attorneys' fees
and costs, including expert witness
fees.44 This is largely a unilateral right;
there is no corresponding right for the
manufacturer or seller to recover its
attorney's fees if it prevails at trial.
As a general rule, the remedies provided by a state consumer protection
act are cumulative and are not construed as restricting any remedy that
is otherwise available. This approach
reflects the strong legislative policy toward providing maximum protection
to consumers. Consequently, recreational boat and equipment manufacturers who seek to minimize warranty
liability and related costs - while
maximizing customer satisfaction should implement a comprehensive,
systematic and proactive program for
managing warranty claims. In the
next article, we will provide specific
recommendations that should be incorporated into any such warranty
program.
l:l
About the Authors: Randy Moore is
a partner in the Orange County, Calif,
office ofSnell & Wilmer L.L.P. and a
member of its Product Liability and
Commercial Litigation Groups. Ryan
Ruggerello is an attorney at Snell &
Wilmer and is a member ofits Product
Liability Group. Their practice is focusedon product liability and consumer
warranty law. For more information or
answers to questions on product liability
or warranty law, please contact Randy
at (714) 427-7007 (rmoore@swlaw.
com) or Ryan at (714) 427-7482 (rruggerello@swlaw.com).
13