Warranties in the United States

Article 2 of the UCC contains several warranty provisions (including Implied Warranty and Express Warranty), though these are not related specifically to products liability. Thus, under UCC, Section 2-312, unless explicitly excluded, the seller warrants he is conveying good title that is rightfully his and that the goods are transferred free of any security interest or other lien or encumbrance. In some cases (e.g., a police auction of bicycles picked up around campus and never claimed), the buyer should know that the seller does not claim title in himself, nor that title will necessarily be good against a third party, and so subsection 2 excludes warranties in these circumstances. But the circumstances must be so obvious that no reasonable person would suppose otherwise.

In Menzel v. List, an art gallery sold a painting by Marc Chagall that it purchased in Paris.Menzel v. List, 246 N.E.2d 742 (N.Y. 1969). The painting had been stolen by the Germans when the original owner was forced to flee Belgium in the 1930s. Now in the United States, the original owner discovered that a new owner had the painting and successfully sued for its return. The customer then sued the gallery, claiming that it had breached the implied warranty of title when it sold the painting. The court agreed and awarded damages equal to the appreciated value of the painting. A good-faith purchaser who must surrender stolen goods to their true owner has a claim for breach of the implied warranty of title against the person from whom he bought the goods.

A second implied warranty, related to title, is that the merchant-seller warrants the goods are free of any rightful claim by a third person that the seller has infringed his rights (e.g., that a gallery has not infringed a copyright by selling a reproduction). This provision only applies to a seller who regularly deals in goods of the kind in question. If you find an old print in your grandmother’s attic, you do not warrant when you sell it to a neighbor that it is free of any valid infringement claims.

A third implied warranty in this context involves the course of dealing or usage of trade. Section 2-314(3) of the UCC says that unless modified or excluded implied warranties may arise from a course of dealing or usage of trade. If a certain way of doing business is understood, it is not necessary for the seller to state explicitly that he will abide by the custom; it will be implied. A typical example is the obligation of a dog dealer to provide pedigree papers to prove the dog’s lineage conforms to the contract. (1)

Problems with Warranty Theory

In practice claimants are in many cases denied recovery. In addition to several general problems, the claimant faces additional difficulties stemming directly from warranty theory. See more about warranty theory here.

Resources

Notes

“Business and the Legal Environment”, by Don Mayer, Daniel M. Warner and George J. Siedel.

Warranties (Bank Collections)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Bank Collections is provided. Finally, the subject of Commercial Law in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Charter Contracts)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Charter Contracts is provided. Finally, the subject of Charterparties in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Construction)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Construction is provided. Finally, the subject of Leases in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Formation)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Formation is provided. Finally, the subject of Leases in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Investment Securities)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Investment Securities is provided. Finally, the subject of Commercial Law in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Letters of Credit)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Letters of Credit is provided. Finally, the subject of Commercial Law in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties (Party Liabilities)

This section introduces, discusses and describes the basics of warranties. Then, cross references and a brief overview about Party Liabilities is provided. Finally, the subject of Negotiable Instruments in relation with warranties is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Warranties