BCOR 320 1nd Edition Lecture 26Chapter 13 cont:Express Warranties: An express warranty is one that the seller creates with his words or actions. Any affirmation of fact--or any promise--can create an express warranty, including• Demonstration• Picture• Blueprint, etc. Any description of the goods can create an express warranty. Any sample or model can create an express warranty.Implied Warranties: Are created by the Code (U.C.C. Art. 2) itself, not by any act or statement of the seller. Implied Warranty of Merchantability Unless excluded or modified, a warranty that the goods shall be merchantable is implied in a contract for their sale, if the seller is a merchant of goods of that kind. By a merchant-seller Implied warranty that goods are Of average , fair or medium grade quality Will pass, without objection in the trade or market, for goods of the same description Be adequately packaged and labeledThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute. Conform to affirmations of fact or promises made on label or container Be of even quality and quantity Implied Warranty of Fitness for a Particular Purpose When the seller at the time of contracting knows about a particular purpose forwhich the buyer wants the goods, and knows that the buyer is relying on the seller’s skill and judgement, there is (unless excluded or modified) an implied warranty that the goods shall be fit for such purpose. By a seller who may or may not be a merchant By seller who has reason to know the particular use for which the buyer is purchasing the goods Buyer who reasonably relies on skill and judgment of seller in selecting suitable goodsDisclaimers and defense: Disclaimer: a statement that a particular warranty does not apply.• Oral Express Warranties – may be disclaimed by clear conspicuous writing.• Written Express Warranties – may NOT be disclaimed.• Implied Warranties of Merchantability – may disclaim, but must use word “merchantability” and the disclaimer must be conspicuous. ***NOTE: Many states prohibit a seller from disclaiming implied warranties in the sale of consumer goods.• All implied warranties (except title) may be disclaimed by use of “As is,” “With all faults” or comparable language in a conspicuous writingNegligence: In negligence cases, plaintiffs most often raise one or more of these claims:• Negligent design • Negligent manufacture• Failure to warn Where a sales contract includes proper disclaimers or remedy limitations, a buyer barred from a negligence case may have no remedy at all.Strict Liability: Need not prove that the defendant’s conduct was unreasonable. Strict liability may be imposed if:• The product must be in defective condition when sold• The defective condition is unreasonably dangerous to the user.• Seller is in business to sell this product (i.e. a merchant seller)• The product reaches the user without substantial change.• The plaintiff must incur physical harm to self or property by use or consumption of product Strict liability may be imposed EVEN if:• The seller exercised all reasonable care.• There is no contractual relationship. Applied to all parties in the chain of distribution of the product ( including manufacturers, processors, wholesalers, distributors, retailers, etc.)Contemporary Trends: Strict liability may be imposed based on design, manufacture or failure to warn. Tests to measure design and warning cases include:• Consumer expectation: if the design causes the product to be less safe than expected• Risk-utility tests: weigh the value of the product, gravity and likelihood of the danger, feasibility of a safer design, and adverse consequences of a safer
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