Warranties Flashcards
Can the warranty of title be disclaimed?
Yes, as long as specific language is used, alertingbuyer that the warranty of title is being disclaimed.
2-312(2)
Can the warranty of title be disclaimed by the seller saying that the goods are sold “as is” ?
No, Warranties of title must be disclaimed by specific language or under certain circumstances.
Marie Antoinette takes her diamond necklace to the Bohmer & Bassenge Jewelers to have it cleaned. Bohmer sells the necklace to Robespierre, who buys in good faith without knowledge of Antoinette’s ownership. Does Robespierre take good title to the necklace?
Yes. Under UCC § 2-403(2), when one entrusts possession of goods to a merchant in goods of that kind, the merchant gets the power to transfer all the entruster’s rights to a buyer in the ordinary course of business. According to § 1201(9), a buyer in ordinary course is one who buys in good faith without knowledge of another’s ownership or security interest in the goods, from a person in the business of selling goods of that kind. Because Robespierre qualifies as a buyer in the ordinary course, and Bohmer as a merchant for these purposes, Robespierre takes good title.
Madame Louvre is in dire financial straits and takes her painting, the Mona Lisa, to a pawnbroker to have it appraised. She leaves for 15 minutes and, when she returns, finds that the pawnbroker has sold the painting to Connie Seur. Does Connie Seur take good title to the Mona Lisa?
No. Under UCC § 2-403(2), when one entrusts possession of goods to a merchant in goods of that kind, the merchant gets the power to transfer all the entruster’s rights to a good-faith buyer in the ordinary course of business. However, this general rule does not apply to pawnbrokers. A purchaser from a pawnbroker is not a buyer in the ordinary course of business. Such a merchant cannot be a pawnbroker. Connie doesn’t take good title.
Inspector Clouseau buys a portable safe from the Dreyfus Safe Shop. He leaves it at the store with the owner’s permission, as he goes to fetch his car, parked several blocks away. While Clouseau is away, Dreyfus sells Clouseau’s safe to Sir Charles Litton, a buyer in the ordinary course of business. Because Dreyfus’ act was criminal, does Clouseau’s interest in the safe have priority over Litton’s?
No. Litton has good title to the safe, because he was a buyer in the ordinary course of business, and Dreyfus was a merchant in goods of the kind. Thus, because Clouseau entrusted the safe to Dreyfus, Litton takes good title under § 2-403(2). Note that Dreyfus’ criminal behavior doesn’t change this result.
Butch steals Pee-Wee’s bicycle. Butch takes it to the Tour de Coeur New & Used Bicycle Store to have a wheel repaired. Tour de Coeur sells the bicycle to Spanky, who reasonably believes Tour de Coeur has the right to sell. Does Spanky’s title prevail over Pee-Wee’s?
No, because the entrustment was by a thief. Pee-Wee didn’t entrust the bicycle to Tour de Coeur or authorize the entrustment. UCC § 2-403. Note that Spanky’s title would prevail against Butch, as Butch was the entruster. Spanky should be able to recover the money he paid to Tour de Coeur
What is an express warranty?
A seller makes an express warranty when he makes an affirmation of fact to the buyer that relates to the goods and becomes part of the basis of the bargain. By making the affirmation, he is expressly warranting that the goods will conform to the affirmation. His description of the goods creates an express warranty that the goods will conform to the description. A sample or model of the of the goods creates an express warranty that the goods will conform to the sample model.
Must the buyer in fact rely on seller’s affirmation to be able to recover on an express warranty theory?
No. Its only necessary to show that the affirmations were in fact made and the buyer might have relied on them when he entered into the contract, not that he is in fact did so.
What is the implied warranty of merchantability
It is an implied warranty, applicable to merchants with respect to goods of the kind involved in the transaction, which provides that the goods must be fair average quality for goods of that kind, and fit for the ordinary purpose for which such goods are used.
- IWOM may be disclaimed, however the provisions governing disclaimer must be observed.
Does the warranty of merchantability apply to used goods as well as to new ones?
Yes, however a contract for the sale of second-hand goods . . . involves only such obligation as is appropriate to such goods fir that is their contract description.
Under the circumstances does the implied warranty of fitness for a particular purpose arise?
Imposed against the seller when he has reason to know:
1. any particular purpose for which the goods are required (by the buyer) and
2. the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods.
PoP Judgment; Particular Purpose; Judgment
Privity
Privity is the relationship between two parties that allows one to sue the other. There are two types of Privity : vertical ( line of distribution ) and horizontal (Users)
Three Alternatives A,B, C . Alternative a is the most restrictive. Alternative B ( expands) Alternative C is the most expensive . expends to corporations/ human injury)
Alternative A
A seller’s Warranty whther express. Or implied extends to any natural person who is in the family or household of his buyer or who is a guest in his home if it is a reasonable to expect that such person may use, consume or be affected by the
