Warranties and Product Liability

Question 1

Explain when the implied warranty of merchantability is given

Answer 1

It is given when:

1. )The seller is a merchant; and
2. )Goods are warranted to be fit for ordinary use, of proper kind, properly packaged, and conform to the label

Question 2

Give examples of language that effectively disclaims implied warranties of merchantability and fitness for a particular purpose

Answer 2

1. )”As is” sale
2. )”Sold with all faults”
3. )Any other language brought to the buyer’s attention plainly making a disclaimer

Question 3

List the requirements for establishing negligence in product liability

Answer 3

1. )Product is in a defective condition that is unreasonably dangerous by design, production, or lack of warning.
2. )The seller is in the business of manufacturing, distributing, or selling the product.
3. )The product reaches the buyer in the same condition as when it left the seller’s possession (i.e., it has not been altered)
4. )The seller had knowledge that the product was defective and did not take steps to fix the problem.

Question 4

What are the necessary requirements for a party in a transaction to disclaim an implied warranty of fitness for a particular purpose?

Answer 4

1. )Must be in writing

2. )Must be conspicuous

Question 5

Describe the elements of a disclaimer of a warranty of title

Answer 5

Must be in writing and conspicuous or be obvious from the nature of the goods or the transaction that there is no warranty of title

Question 6

List the protections given by the implied warranty of title

Answer 6

1. )The seller has a good title and transfer is rightful.
2. )There are no outstanding liens, encumbrances, or security interests.
3. )If the seller is a merchant, goods will be delivered free from third-party infringement claims.

Question 7

When does an implied warranty that arises from a course of dealing or trade usage apply?

Answer 7

When both parties have knowledge of a well-recognized usage of trade or, by numerous past performances, infer a warranty course of action intended to be performed

Question 8

List the requirements for establishing strict tort liability

Answer 8

1. )Product is in a defective condition that is unreasonably dangerous by design, production, or lack of warning.
2. )The seller is in the business of manufacturing, distributing, or selling the product.
3. )The product reaches the buyer in the same condition as when it left the seller’s possession (i.e., it has not been altered).

Question 9

What are the requirements for a disclaimer of oral express warranties?

Answer 9

1. )Specific
2. )Unambiguous
3. )Clearly and conspicuously drawn to attention of the buyer

Question 10

What are the necessary requirements for a party in a transaction to disclaim an implied warranty of merchantability?

Answer 10

1. )Must mention the word “merchantability”
2. )Can be in writing or oral
3. )If in writing, must be conspicuous

Question 11

Describe the elements of a disclaimer of an implied warranty of merchantability

Answer 11

1. )If written, it must be conspicuous.
2. )It must use terms such as “No warranty of merchantability” or a general disclaimer of “As is,” “With all faults,” or “As they stand.”

Question 12

List the justifications that a party in a transaction can use as a warranty defense.

Answer 12

1. )Lack of privity
2. )Statute of limitations
3. )Failure of notice of breach

Question 13

List three types of express warranties

Answer 13

1. )Affirmations of fact or promises
2. )Descriptions
3. )Samples or models

Question 14

List the four types of warranties that are given under Article 2 sales contracts

Answer 14

1. )Express warranties
2. )Implied warranty of title
3. )Implied warranty of merchantability
4. )Implied warranty of fitness for a particular purpos

Question 15

Can an express warranty be withdrawn?

Answer 15

It is not possible to make an express warranty and then withdraw it when it has been a basis of the bargain

Question 16

What is the difference between recovery under strict tort liability and recovery under negligence?

Answer 16

Punitive damages are available for negligence

Question 17

List the four criteria required for an implied warranty of fitness for a particular purpose

Answer 17

1. )The seller must expressly or impliedly know the purpose or buyer’s use.
2. )The buyer must rely on the seller in making selection.
3. )The seller possesses the experience or expertise to make a recommendation.
4. )The seller makes a recommendation to the buyer

Question 18

Describe the elements of a disclaimer of an implied warranty of fitness for a particular purpose

Answer 18

1. )Must be written
2. )Must be conspicuous
3. )Must be general, such as “As is,” “With all faults,” or “As they stand” (These general terms also disclaim the warranty of merchantability.)