Sales Contracts 2 of 3 (36)

Question 1

Implied Warranty of Merchantability

Answer 1

An automatic warranty associated with the sale of goods in which the seller warrants that the goods are in fair condition (average, fair quality) for their ordinary purpose and conform to claims on the product’s packaging, which may be disclaimed by phrases such as “as is” or “with all faults” in the sales contract.

Question 2

Implied Warranty of Fitness for a Particular Purpose

Answer 2

A warranty associated with the sale of goods when the buyer is relying on the seller’s judgment that the goods will be useful for the buyer’s specific needs, which may be disclaimed in writing with a phrase such as “as is” or “with all faults.”

Question 3

Express Warranty

Answer 3

A statement or claim made by the seller that becomes a basis of the transaction and may not be disclaimed.