Study Guide - Unit 4 - Chapter 21 - Warranties and Product Liability - Chapter 21 Warranties and Product Liability Page 265 Warranties of title title

Study Guide - Unit 4 - Chapter 21 - Warranties and Product Liability

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Chapter 21 – Warranties and Product Liability Page 265 Warranties of title – title warranty arises automatically in most sales contracts, there are three types of warranties of title: o Good title, in most cases, sellers warrant that they have valid title to the goods sold and that transfer of the title is rightful o No liens, a second warranty of title provided by the UCC protects buyers who are unaware of any encumbrances (claims, charges, or liabilities) against goods at the time the contract was made o No infringements, a third type of title warranty is a warranty against infringement of any patent, trademark, or copyright o Disclaimer of title warranty, in an ordinary sales transaction, the title warranty can be disclaimed or modified only be specific language in a contract Lien – an encumbrance on a property to satisfy or protect a claim for payment of a debt Page 266 Express warranty – a promise, ancillary to an underlying sales or lease agreement that is included in the written or oral terms of the agreement under which the promisor assures the quality, description, or performance of the goods, express warranties arise when a seller or lessor indicates any of the following: - That the goods conform to any affirmation or promise of the fact that the seller or lessor makes to the buyer or lessee about the goods - That the goods conform to any description - That the goods conform to any sample or model o Basis of bargain, the UCC requires only that the affirmation, promise, description, or sample must become part of the “basis of the bargain”, it is a question of fact in each case whether a representation was made at such a time and in such a way that it induced the buyer or lessee to enter the contract o Statements of opinion, the seller is not creating an express warranty if the seller or lessor
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