This paper examines how express and implied warranties operate under the Uniform Commercial Code (UCC) in the sale of goods. It explains the three methods by which express warranties are created — affirmations of fact, descriptions, and samples — and outlines the implied warranties of merchantability and fitness for a particular purpose. Using the Golfing Gizmo product liability case as a practical illustration, the paper analyzes how label statements can constitute express warranties, when a breach of warranty occurs, and how sellers may attempt to disclaim warranty obligations. It concludes with observations on how sellers can better protect themselves from liability through careful product labeling and risk communication.
Under the Uniform Commercial Code (UCC), an express warranty can be created in three different ways. In each instance, it is vital that the event generating the express warranty occur at the point at which the buyer could have relied on it. The first way an express warranty can be formed is for the seller to make any affirmation of fact or promise that relates to the goods and becomes part of the basis of the bargain. Oral or written statements about the products that the buyer relies on when making a purchase can create an express warranty. Similarly, statements contained in product labels may be considered to create express warranties.
An express warranty can also be formed if the seller provides any description of the goods that becomes part of the basis of the bargain. In that case, the warranty is that the goods will conform to the description. A third way of creating an express warranty is for the seller to display a sample or model of the goods. If the sample or model becomes part of the basis of the bargain, the warranty is that all of the goods will conform to that sample or model.
Express warranties typically involve the seller's oral or written statements about the goods. If those statements tend to induce the buyer to make the purchase, they may be regarded as express warranties (Warranties in Sales of Goods, n.d.).
In jurisdictions governed by common law, certain implied warranties are presumed to be made in the sale of goods. The warranty of merchantability is implied unless it is expressly disclaimed or the sale is made using the phrase "as is" or "with all faults." In order to be merchantable, the goods must reasonably conform to an ordinary buyer's expectations — meaning the product works like other goods of the same kind. The warranty of fitness for a particular purpose is implied by law where a seller knows, or has reason to know, of a specific purpose for which the buyer is acquiring the product and the buyer relies on the seller's skill or judgment in selecting the goods (Sale of Goods, 2010).
In the case involving the sale of the Golfing Gizmo, the express warranties made by the seller would cover the buyer's damages. The seller created an express warranty through statements printed on the label of the shipping carton and the cover of the instruction booklet. Those statements urged players to drive the ball with full power and further declared that the product was completely safe and that the ball would not hit the player.
As noted above, statements included in product labels may be considered to create express warranties. An express warranty is also formed when the seller makes any description of the goods that becomes part of the basis of the bargain, with the warranty being that the goods will conform to that description. That is precisely what occurred in this case. The seller stated that the product was completely harmless and that the ball would not strike the player — yet the product was not safe and the ball did strike the player, causing injury and damage.
Product liability is the area of law that holds manufacturers, distributors, suppliers, retailers, and others who make products available accountable for the harm those products cause. The issues most frequently associated with product liability are negligence, strict liability, breach of warranty, and various consumer protection claims. A warranty is breached when the guarantee is broken — that is, when the goods are not as represented at the time of sale — regardless of whether the defect was apparent. When a breach occurs, the seller is responsible for making the buyer whole by providing a refund or a replacement.
"How sellers may legally disclaim warranty obligations"
"Practical advice on avoiding overreaching product claims"
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