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14.1 Express and Implied Warranties . After finishing this section, you will know how to: Describe the three ways an express warranty can be made State the obligations of merchants under the Magnuson Moss Warranty Act Contrast a full warranty with a limited warranty

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14 1 express and implied warranties
14.1 Express and Implied Warranties

  • After finishing this section, you will know how to:

    • Describe the three ways an express warranty can be made

    • State the obligations of merchants under the Magnuson Moss Warranty Act

    • Contrast a full warranty with a limited warranty

    • Differentiate between the implied warranty of fitness for a particular purpose and the implied warranty of merchantability


  • Warranty- SELLER’S GUARANTEE THAT THEIR PRODUCT IS NOT DEFECTIVE AND THAT IT IS SUITABLE FOR THE USE FOR WHICH IT WAS INTENDED





  • Statement or promise MANUFACTURER OR SELLER

  • STATEMENT OF AN EXISTING FACT:

  • Example 1

  • PROMISE OF SOMETHING THAT MAY HAPPEN IN THE FUTURE:

  • Example 2

  • EXPRESS WARRANTIES ARE OFTEN FOUND IN SALES BROCHURES, CIRCULARS, AND ADVERTISEMENTS.

  • Example 3



  • Description of the goods MANUFACTURER OR SELLER- THE SELLER WARRANTS THAT THE GOODS WILL BE THE SAME AS THE DESCRIPTION

  • Example 4

  • Sample or model- THE SELLER WARRANTS THAT THE GOODS WILL BE THE SAME AS THE SAMPLE OR MODEL

  • Example 5


  • Consumer protection MANUFACTURER OR SELLER

  • Guarantee- A PROMISE OR ASSURANCE OF THE QUALITY OR LIFE OF A PRODUCT

  • ANOTHER NAME FOR EXPRESS WARRANTY

  • Guarantor- ONE MAKING THE PROMISE

  • Example 6



  • Magnuson-Moss Warranty Act (1975) MANUFACTURER OR SELLER- FTC CAN DEVELOP RULES REGUALTING THE ADVERTISEMENT OF GRARANTEES AND TO ENFORCE THESE GUIDELINES

  • PRODUCT OR PART COVERED BY THE GUARANTEE

  • TIME LIMIT WHEN THE PRODUCT IS ADVERTISED WITH A “LIFETIME GUARANTEE” OF PRODUCT LIFE OR THE LIFETIME OF THE PERSON

  • HOW THEY WILL SETTLE THE CLAIM

  • IDENTITY OF WHO IS THE GUARANTOR


  • Full or Limited Warranty ($10 or more) MANUFACTURER OR SELLER

  • Full warranty-ONE IN WHICH A DEFECTIVE PRODUCT WILL BE FIXED OR REPLACED FREE WITHIN A REASONABLE TIME AFTER THE COMPLAINT HAS BEEN MADE ABOUT IT.

  • THE CONSUMER DOESN’T HAVE TO ANYTHING UNREASONABLE- SHIP HEAVY PRODUCTS BACK TO THE FACTORY

  • GOOD NO MATTER WHO OWNS IT

  • IF IT CAN’T BE FIXED- NEW ONE OR MONEY BACK


  • Limited warranty MANUFACTURER OR SELLER- A WARRANTY THAT PROVIDES RESTRICTED PROTECTION

  • MUST BE LABELED

  • WHEN YOU SEE THIS ON A LABEL IT’S A GOOD IDEA TO READ THE WARRANTY



  • Implied warranty be:- GUARANTEE OF QUALITY IMPOSED BY LAW

  • NOT IN WRITING

  • ONLY WITH A SALE OF GOODS



  • Warranty of Fitness for a particular purpose be:- THE SELLER GUARANTEES THAT GOODS ARE SUITABLE AND FIT FOR THE PURPOSE FOR THE BUYERS NEEDS

  • THE SELLER ADVISES THE BUYER AND THE BUYER RELIES ON THAT RECOMMENDATION

  • Example 8


  • Warranty of Merchantability be:- IMPLIED WARRANTY THAT MAKES MERCHANT OR SELLER LIABLE FOR GOODS THAT ARE NOT FAIR OR AVERAGE QUALITY AND FIT FOR ORDINARY PURPOSES FOR WHICH SUCH GOODS ARE USED

  • To be merchantable, goods must be:

  • PASS WITHOUT OBJECTION IN THE TRADE

  • BE FIT FOR ORDINARY PURPOSE

  • ADEQUATELY CONTAINED, PACKAGED, AND LABELED

  • CONFORM TO THE PROMISE



  • Usage of trade be:- COMMON PRACTICE- WHEN SELLING A PUREBREAD DOG: THE ANIMAL IS ACCOMPANIED BY PAPERS

  • Warranty of title- SELLER WARRANTS THAT THE TITLE IS GOOD AND DELIVERED FREE OF ANY FINANCIAL OBLIGATIONS

  • Example 11


Assignment
Assignment be:

  • Page 304

  • Reviewing What You Learned

  • #1-5


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