Disclaimers and Other Limitations on Warranties

Question 1

To modify or exclude IWM

Answer 1

the language in disclaimer must mention merchantability and if it’s a writing it must be conspicuous (can be disclaimed orally)

Question 2

To modify or exclude IFW

Answer 2

the language must be in writing and it must be conspicuous

Question 3

To modify or exclude Express warranties

Answer 3

Can’t technically disclaim (can have a merger clause

Question 4

Is an “As Is” clause effective?

Answer 4

it is effective unless circumstances indicate otherwise (but not where there is fraud or a misrepresentation) (not as good as other disclaimers)
Ex. clause stating buyer accepts delivery of goods in good condition, the vehicle was described as new, the custom was only for used goods to be sold as is, previous dealings did not have as is clause

Question 5

Does an as is clause have to be conspicuous?

Answer 5

some courts say yes, some say no ( Henning says better reading of code is no)

Question 6

test for conspicuousness

Answer 6

whether attention can be reasonably be expected to be called to it

• take into account sophistication of the parties
• more than just all caps (formatting is important)
• can be on the back of the of page if K directs to look at back of page

Question 7

when are disclaimers not effective?

Answer 7

• Personal injury cases
• If clause is held to be unconscionable
• if disclaimer is for express warranty (but merger clause is ok)

Question 8

Is vertical privity a defense?

Answer 8

Courts are split (except most say no for personal injury if SL is not available) (most say if you make a representation and a party relies on it, you can’t hide behind it)

• the one’s that say no
• usually limit to direct damages (no consequential)
• the ones that say yes