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implied warrranties in sales of goods

Many states have laws that provide for implied warranties made by sellers (known as merchants) in sales of goods. These implied warranties are designed to protect buyers of goods whether or not there is a written warranty for the goods, and whether the goods are new or used.

Implied Warranty of Merchantability

Implied warranties generally provide assurances or promises that the goods are fit for their intended purpose and that the goods are merchantable—meaning they conform to or meet an ordinary buyer’s expectations. This implied warranty is known as the implied warranty of merchantability.

In some states this implied warranty of merchantability may be disclaimed by a seller or merchant when the goods are sold with the disclaimer that they are sold “as is” or “with all faults.” But in some states this warranty cannot be disclaimed—at least not in the sale of new goods.

Implied Warranty of Fitness

The implied warranty of fitness—also known as the implied warranty of fitness for a particular purpose or the implied warranty of fitness for a specific purpose—means a product is guaranteed to be fit for a specific purpose or use, as stated or recommended by the merchant’s salesperson or other representative.

Implied Warranty Against Infringement of Intellectual Property

Some state laws include an implied warranty against infringement of a third-party’s intellectual property. This means that if a merchant sells a product that infringes another person or entity’s intellectual property (patent, copyright, or trademark), they seller that sold the infringing goods must indemnify or protect the buyer against any infringement claim by the owner of the intellectual property.

Where to Find Warranty Laws

Warranties in the sale of goods are usually located in a state’s statutes—often in the state’s adopted version of Article 2 of the Uniform Commercial Code (UCC).

In Texas, the regulation of implied warranties in the sale of goods is governed by the state's version of the Uniform Commercial Code (UCC), specifically under Chapter 2. The implied warranty of merchantability ensures that goods sold by a merchant are fit for the general purpose for which they are sold and that they meet the standards of the buyer's expectations. Texas law allows merchants to disclaim this warranty if they clearly indicate that the goods are being sold 'as is' or 'with all faults.' The implied warranty of fitness for a particular purpose applies when a buyer relies on the seller's expertise to select goods suitable for a specific use. If the seller knows about this reliance and the buyer purchases the goods, this warranty is implied unless expressly disclaimed. Regarding the implied warranty against infringement of intellectual property, Texas law also provides protection to buyers in case the goods infringe on someone else's intellectual property rights. The seller may be required to indemnify the buyer if such a claim arises. These warranties and their potential disclaimers are typically found in the Texas Business and Commerce Code, which incorporates the relevant provisions of the UCC.

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