Express and Implied Warranties

1. Express and Implied Warranties

2. What basic obligations do you presume the seller should take? • In a sale the seller is the party to provide goods. What the seller should do is : (1) to deliver the goods (2) to hand over any documents relating to the goods (3) to transfer the property in the goods

3. Different contract laws classify the seller’s obligations in different ways. 1. English law of contract • The seller’s obligations are classified into conditionsand warranties. • How to distinguish conditions and warranties? (1) conditions----main/fundamental contractual terms underlying the contract

4. warranties----contractual terms subsidiary to the main purposes of the contract (2) If the seller breaches conditions of the contract, the buyer can avoid the contract and claim damages. If the seller breaches warranties of the contract, the buyer cannot avoid the contract and only can claim damages.

5. 2. American law of contract: UCC • The seller’s obligations are classified into express warranties and implied warranties. (1) express warranties arecontractual terms directly made by the seller about their goods and should be spelled out clearly.

6. Implied warranties are those warranties that are not expressly given in contract by the seller but are “read into the contract” by the law. That is, they are not written in a contract, but are legally taken to be present in the contract.

7. 3. The seller’s obligations under CISG • The provisions of the CISG are similar to those in the UCC. Under CISG Article 35, the seller must deliver goods that are of the quantity, quality and description required by the contract.

8. Disclaiming implied warranties What is the main difference between the UCC and the CISG in making disclaimers? (1) One notable difference between the UCC and the CISG is that U.S. law places the restrictions on the parties’ ability to limit the implied warranties of the UCC. The CISG has no restrictions in limiting disclaimers. Any form of disclaimer is allowed under the CISG.

9. (2) Under the UCC, if a seller does not want to take some obligations concerning implied warranties, he may “disclaim” an implied warranty only by using conspicuous, or specified, language to that effect.

10. Notice of Nonconforming Goods • Most legal systems require that notice be given by a buyer to a seller in the event of a breach due to nonconforming goods. • Many European countries prefer short period of notification (often a year or less). However, the developing countries prefer longer period.

11. The CISG is in favor of the concerns of developing countries as to this point. (Art. 38/39) • Under CISG (1) the buyer examines the goods within as short a period as is practicable after they are received; (2) the buyer should give notice of a nonconformity or defect in the goods within a reasonable time unless some reasonable excuse prevents doing so; (3) notice must be given within two years from the date on which the goods were handed over to the buyer;(4) if the buyer fails to give proper notice, the buyer loses the right to assert the breach against the seller.

12. Under CISG (1) the buyer examines the goods within as short a period as is practicable after they are received; (2) the buyer should give notice of a nonconformity or defect in the goods within a reasonable time unless some reasonable excuse prevents doing so; (3) notice must be given within two years from the date on which the goods were handed over to the buyer;(4) if the buyer fails to give proper notice, the buyer loses the right to assert the breach against the seller.