A consumer purchases a new smart refrigerator from 'Appliance World,' a retailer. The sales contract includes a prominent clause stating: 'ALL IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTY OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED.' Two weeks later, the refrigerator's cooling system fails completely due to a manufacturing defect. The consumer seeks to return the refrigerator and get a full refund based on a breach of the implied warranty of merchantability. Is the consumer likely to succeed?
- AYes, because implied warranties cannot be disclaimed in consumer contracts.
- BNo, because 'Appliance World' effectively disclaimed the implied warranty of merchantability.
- CNo, because the defect occurred after the point of sale, making it the manufacturer's responsibility.
- DYes, because the disclaimer was not conspicuous enough to be effective.
Show answer & explanationAnswer & explanation
Correct answer: B. No, because 'Appliance World' effectively disclaimed the implied warranty of merchantability.
Under the UCC, the implied warranty of merchantability can be disclaimed, but the disclaimer must be conspicuous and, if in writing, must mention 'merchantability.' The scenario states the clause was 'prominent' and explicitly mentioned the warranty, suggesting a valid disclaimer. Therefore, the consumer is unlikely to succeed based on this implied warranty.
Why the other options are wrong
- A. Implied warranties can be disclaimed in consumer contracts under the UCC, provided specific requirements are met.
- C. The point of sale is when the warranty attaches. If the warranty was validly disclaimed, the timing of the defect doesn't revive a non-existent warranty claim against the retailer (though a claim against the manufacturer's express warranty might exist).
- D. The question states the clause was 'prominent,' which implies it was conspicuous, satisfying that requirement for a valid disclaimer.
UCC Implied Warranty Disclaimer
The Uniform Commercial Code (UCC) allows sellers to disclaim implied warranties, such as merchantability and fitness for a particular purpose, provided specific requirements for conspicuousness and language are met.
- Disclaimer of merchantability must mention 'merchantability' and be conspicuous.
- Disclaimer of fitness for a particular purpose must be in writing and conspicuous.
- General phrases like 'as is' or 'with all faults' can also disclaim all implied warranties.
Memory trick: To ditch the 'implied,' make it LOUD and CLEAR, or your wallet will shed a tear.