Business Law Ch 21

statement of opinion (puffing)

a commendation of goods, made by a seller, that does not create an express warranty

Magnuson- Moss Warranty Act

a federal statute that regulates written warranties on consumer products, administered by the Federal Trade Commission, only governs consumer transactions not commercial or industrial, sellers who make express WRITTEN warranties related to consumer products are forbidden from disclaiming or modifying the implied warranties of merchantability and fitness for a particular purpose, authorizes warrantors to establish an informal dispute-resolution procedure (arbitration)

conspicuous

a requirement that warranty disclaimers must be noticeable to a reasonable person (heading in uppercase, typeface that is larger, or different color type)

warranty

a seller's express or implied assurance to buyer that the goods sold meet certain quality standards

warranty disclaimer

a statement that negates express and implied warranties

foreign substance test

a test to determine merchantability based on foreign objects found in food

consumer expectation test

a test to determine merchantability based on what the average consumer would expect to to find in food products, used by the majority of states

express warranty

a warranty created when a seller makes an affirmation that the goods he or she is selling meet certain standards of quality, description, performance, or condition (affirmation of fact, promise made, any description, a model or sample)

warranty of no security interests

a warranty in which sellers of goods warrant that the goods they sell are delivered free from any third-party security interests, liens, or encumbrances that are unknown to the buyer

warranty of good title

a warranty in which the seller warrants that he or she has valid title to the goods he or she is selling and that the transfer of title is rightful

implied warranty of fitness for human consumption

a warranty that applies to food or drink consumed on or off the premises of restaurants, grocery stores. fast-food outlets, coffee shops, bars, vending machines, and other purveyors of food and drink

implied warranty of fitness for a particular purpose

a warranty that arises when a seller warrants that the goods will meet the buyer's expressed needs, implied if: 1) seller has reason to know the particular purpose 2) seller makes a statement that the goods will serve this purpose 3) buyer relies on the seller's skill and judgement and purchases

warranty against infringements

an automatic provided by a seller who i a merchant who regularly deals in goods of the kinds s old that warrants that the goods are delivered free of any this party patent, trademark, or copyright claim

compensatory damages

damages that are generally equal to the difference between the value of the goods as warranted and the actual value of the goods accepted at the time and place of acceptance

"as is" disclaimer

expressions such as as is, with all faults to make it clear there are no implied warranties, not specific enough to disclaim warranty of good title and of no security interests

standards of implied warranty of merchantability

fit for ordinary purposes, adequately contained, packaged, and labeled, be of even kind, quality, and quantity, conform to any promise made on the container, quality must pass without any objection, fungible goods must meet a fair average of quality

disclaimer of the implied warranty of fitness for a particular purpose

if "as is" is not used, may contain general language without specific language, has to be in writing

disclaimer of the implied warranty of merchantability

if "as is" is not used, this warranty must specifically mention the term merchantability to be disclaimed, may be oral or written

warranty of no interference (quiet possession)

lessor warrants that no person holds a claim or an interest in the goods that arose from an act or omission of the lessor that will interfere with the lessee's enjoyment of his or her leasehold interest

full warranty

the warrantor must guarantee that a defective product will be repaired or replaced free during the warranty period, must indicate whether there is a time limit

implied warranty of merchantability

unless properly disclosed, a warranty that is implied that sold goods are fit for the ordinary purpose for which they are sold, as well as other assurances, does not apply to sales by non merchants

limited warranty

warrantor limits the scope of the warranty, warranty that covers costs of parts but not labor to fix, more often made than full warranties