14.1 Express and Implied
Warranties
 After finishing this section, you will know
how to:
 Describe the three ways an express warranty
can be made
 State the obligations of merchants under the
Magnuson Moss Warranty Act
 Contrast a full warranty with a limited warranty
 Differentiate between the implied warranty of
fitness for a particular purpose and the
implied warranty of merchantability
 Warranty- SELLER’S GUARANTEE THAT
THEIR PRODUCT IS NOT DEFECTIVE
AND THAT IT IS SUITABLE FOR THE
USE FOR WHICH IT WAS INTENDED
 Warranties are intended to:
 PROVIDE AN INCENTIVE TO BUY
 IMPROVE THE QUALITY OF
PRODUCTS
 There are 2 types of warranties under the
UCC:
 Express warranty
 Implied warranty
 Express warranty- ORAL OR WRITTEN
GUARANTEE BY THE MANUFACTURER
OR SELLER
 There are 3 types of express warranties:
 STATEMENT OF FACT OR PROMISE BY
THE SELLER
 DESCRIPTION OF THE GOODS
 USE OF SAMPLE OR MODEL
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Statement or promise
STATEMENT OF AN EXISTING FACT:
Example 1
PROMISE OF SOMETHING THAT MAY
HAPPEN IN THE FUTURE:
 Example 2
 EXPRESS WARRANTIES ARE OFTEN FOUND
IN SALES BROCHURES, CIRCULARS, AND
ADVERTISEMENTS.
 Example 3
 STATED IN CLEAR, PRECISE, AND
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UNDERSTANDABLE TERMS
TRY TO GET THE WARRANTY IN
WRITING
DOESN’T HAVE TO BE WRITTEN, BUT
IT MAKES IT EASIER TO PROVE
PAROL EVIDENCE RULE APPLIES
OPINIONS ARE NOT WARRANTIES
 Description of the goods- THE SELLER
WARRANTS THAT THE GOODS WILL
BE THE SAME AS THE DESCRIPTION
 Example 4
 Sample or model- THE SELLER
WARRANTS THAT THE GOODS WILL
BE THE SAME AS THE SAMPLE OR
MODEL
 Example 5
 Consumer protection
 Guarantee- A PROMISE OR
ASSURANCE OF THE QUALITY OR LIFE
OF A PRODUCT
 ANOTHER NAME FOR EXPRESS
WARRANTY
 Guarantor- ONE MAKING THE PROMISE
 Example 6
 A GUARANTEE NEEDS TO BE STATED
CLEARLY
 FTC- FEDERAL AGENCY SET UP IN
1914 TO ENSURE FAIR ECONOMIC
PRACTICES
 Magnuson-Moss Warranty Act (1975)- FTC CAN
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DEVELOP RULES REGUALTING THE
ADVERTISEMENT OF GRARANTEES AND TO
ENFORCE THESE GUIDELINES
PRODUCT OR PART COVERED BY THE
GUARANTEE
TIME LIMIT WHEN THE PRODUCT IS ADVERTISED
WITH A “LIFETIME GUARANTEE” OF PRODUCT LIFE
OR THE LIFETIME OF THE PERSON
HOW THEY WILL SETTLE THE CLAIM
IDENTITY OF WHO IS THE GUARANTOR
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Full or Limited Warranty ($10 or more)
Full warranty-ONE IN WHICH A DEFECTIVE
PRODUCT WILL BE FIXED OR REPLACED FREE
WITHIN A REASONABLE TIME AFTER THE
COMPLAINT HAS BEEN MADE ABOUT IT.
THE CONSUMER DOESN’T HAVE TO ANYTHING
UNREASONABLE- SHIP HEAVY PRODUCTS BACK
TO THE FACTORY
GOOD NO MATTER WHO OWNS IT
IF IT CAN’T BE FIXED- NEW ONE OR MONEY
BACK
 Limited warranty- A WARRANTY THAT
PROVIDES RESTRICTED PROTECTION
 MUST BE LABELED
 WHEN YOU SEE THIS ON A LABEL IT’S
A GOOD IDEA TO READ THE
WARRANTY
 Magnuson-Moss Warranty Act- $15 or
over the warranty must be:
 AVAILABLE FOR THE CUSTOMER TO
READ
 FULLY DISCLOSED IN SIMPLE, EASILY
UNDERSTANDABLE LANGUAGE AND
TERMS AND CONDITIONS OF THE
WARRANTY
 Example 7
 Implied warranty- GUARANTEE OF
QUALITY IMPOSED BY LAW
 NOT IN WRITING
 ONLY WITH A SALE OF GOODS
 There are two principal types of implied
warranties:
 WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE
 WARRANTY OF MERCHANTABILITY
 Warranty of Fitness for a particular
purpose- THE SELLER GUARANTEES
THAT GOODS ARE SUITABLE AND FIT
FOR THE PURPOSE FOR THE BUYERS
NEEDS
 THE SELLER ADVISES THE BUYER
AND THE BUYER RELIES ON THAT
RECOMMENDATION
 Example 8
 Warranty of Merchantability- IMPLIED WARRANTY
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THAT MAKES MERCHANT OR SELLER LIABLE FOR
GOODS THAT ARE NOT FAIR OR AVERAGE
QUALITY AND FIT FOR ORDINARY PURPOSES FOR
WHICH SUCH GOODS ARE USED
To be merchantable, goods must be:
PASS WITHOUT OBJECTION IN THE TRADE
BE FIT FOR ORDINARY PURPOSE
ADEQUATELY CONTAINED, PACKAGED, AND
LABELED
CONFORM TO THE PROMISE
 ONLY GIVEN BY A MERCHANT
 Example 9
 NEW OR USED GOODS
 Example 10
 Usage of trade- COMMON PRACTICEWHEN SELLING A PUREBREAD DOG:
THE ANIMAL IS ACCOMPANIED BY
PAPERS
 Warranty of title- SELLER WARRANTS
THAT THE TITLE IS GOOD AND
DELIVERED FREE OF ANY FINANCIAL
OBLIGATIONS
 Example 11
Assignment
 Page 304
 Reviewing What You Learned
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