BL-Chapter 21 - 1 CHAPTER 21 SALES AND LEASE WARRANTIES...

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CHAPTER 21 SALES AND LEASE WARRANTIES Caveat Emptor Let the buyer beware .” Doctrine governed law of sales and leases since Roman times. Warranties that apply under UCC give buyers more protection Article 2 of the UCC has been adopted by most states and it establishes certain warranties that apply to the sale of goods. Article 2A establishes the warranties that apply to lease transactions -Warranties -the buyer’s or lessee’s assurance that the goods meet certain standards -Warranties can be either expressly stated or implied -If the seller or lessor fails to meet a warranty, the buyer or lessee can sue for breach of warranty Express Warranties -Express warranty- created when seller/lessor affirms goods they are selling meet certain standards of quality, description, performance, or condition. -Express warranties are the oldest form of warranty May be written, oral, or inferred from conduct. Sellers/lessors not required to make such warranties, but goods accompanied by warranty often attractive to buyers/lessees. Not necessary to use formal words such as warrant or guarantee to create express warranty. 1
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They can be made by mistake because the seller doesn’t have specifically intend to make a warranty Sellors and lessors are not required to make express warranties—they are usually made to entice consumers and others to buy or lease their products—the reason why they are often in the form of ads, pictures, etc. An express warranty is created when seller/lessor indicates goods will conform to: All affirmations of facts or promises made about them “e.x. the car will get 100 mph” Any descriptions of them (“ Idaho potatoes ”; “ v.v.s. quality diamonds ”) Any model or sample of them (ex. a model oil-drilling rig) Basis of the Bargain Basis of the bargain- Buyers can recover for breach of an express warranty if the warranty was a contributing factor—not necessarily the sole factor-- that enticed buyer/lessee to enter contract Statements made at or before time of contracting are presumed to be part of the basis of the bargain unless good reason is show to the contrary Postsale statements that modify the contract are part of the basis of the bargain A retailer is liable for express wanrranties made by manufacturers of goods it sells A manufacturer is not liable for express warranties made by wholesalers and retailers unless the manufacturer authorizes or ratifies the warranty 2
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BL-Chapter 21 - 1 CHAPTER 21 SALES AND LEASE WARRANTIES...

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