Disclaimers in contracts are generally included when one party wants to sell a product or service without any guarantee of its quality (merchantability) or suitability for the buyer’s intended use. Guarantees of a product’s quality or suitability are also known as warranties, and may be implied in the parties’ agreement without being written or spoken—usually by virtue of a state’s statutes adopting the Uniform Commercial Code’s provisions governing the sale of goods (Article 2)—or by court opinions (also known as common law or case law). Some states have laws (statutes) that prohibit the disclaimer of warranties; make disclaimers ineffective; and penalize parties who attempt to disclaim such warranties. Disclaimers in contracts also serve as an explicit warning to the parties of the risks in a sale or transaction and help avoid a subsequent claim that a party was unaware of such risks or was deceived regarding the presence of such risks.
In Massachusetts, disclaimers in contracts are subject to both the Uniform Commercial Code (UCC) as adopted by the state and the Massachusetts General Laws. Under the UCC, which Massachusetts has adopted, sellers can disclaim implied warranties of merchantability and fitness for a particular purpose, but such disclaimers must be conspicuous and specifically worded to be effective. For example, to disclaim the implied warranty of merchantability, the language must mention 'merchantability' and in case of a written disclaimer, it must be conspicuous. To disclaim the implied warranty of fitness, the disclaimer must be in writing and conspicuous. Massachusetts law also requires certain consumer protection measures, such as the Massachusetts Consumer Protection Act (Chapter 93A), which prohibits unfair or deceptive acts or practices in the conduct of any trade or commerce and could impact the enforceability of disclaimers that are deemed unfair or deceptive. Additionally, certain products may be subject to specific warranty regulations that could override or affect the ability to disclaim warranties. It is important for parties in Massachusetts to carefully draft disclaimers to ensure they comply with applicable laws and are not misleading, as this could lead to legal penalties or the disclaimer being rendered ineffective.