Contracts: Terms - Warranties & Product Liabilities Flashcards Preview

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Flashcards in Contracts: Terms - Warranties & Product Liabilities Deck (6)
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1

UCC Article 2:
Express Warranties

- Affirmation of fact/promise of performance
- Description of goods
- Samples or models
Nature:
- can be oral or written
- in brochures, advertisments, etc.
- created without words warranty or guarantee
- given by merchants and non-merchants alike
Disclaimer:
- Impossible to disclaim a written express warranty
- disclaimer of oral warranties must be specific, unambiguous, and call attention of the buyer.

2

UCC Article 2:
Implied Warranty of Title

Content:
- seller has good title and it is transferable
- No outstanding liens, encumbrances, or security interests are hidden
- If seller is a merchant, goods will be delivered free from third party claims
Disclaimer:
- Can be disclaimed by language or buyer's knowledge of title problems
- General disclaimer of warranties doesn't work
- or circumstances where buyer should have been aware there was no warranty of title (trunk of car)

3

UCC Article 2:
Implied Warranty of Merchantibility

Criteria:
- Made only by a merchant.
Disclaimer:
- must mention word "merchantibility"
- can be oral or in writing (conspicuous)

4

UCC Article 2:
Implied Warranty of Fitness for a Particular Purpose

Criteria:
- seller must expressly or by implication know the purpose or buyers use of goods AND
- buyer must rely on sellers selection or recommendation in making the purchase
Disclaimer:
- must be in writing and conspicuous

5

UCC Article 2:
Both:
Implied Warranty of Merchantibility
Implied Warranty of Fitness for a Particular Purpose

Can be disclaimed by words such as
"sold as is"
"sold with all faults"
"As they stand"

***Other warranties cannot be disclaimed w/ this wording***

6

UCC Article 2:
Strict Tort Liability

Privity Issue:
- Article 2 does not require privity of contract for liability
- Extends warranty protection to third parties that could be expected to use a product
Requirements:
- Unreasonably Dangerous:
1. Defective in design
2. Defective in manufacture
3. Defective in lack of warnings
- Seller is in business of selling and/or manufacturing
- Product reached the buyer in same condition it was when it left the manufacturer
Negligence:
- same elements as strict tort liability
- but also requires knowledge, the seller/manufacturer was aware
- knowledge allows for recovery of punitive damages

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