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 Virginia, disclaimers in contracts are subject to both the Virginia Code and the Uniform Commercial Code (UCC), which Virginia has adopted. Under the UCC, particularly Article 2 which governs the sale of goods, sellers can disclaim implied warranties of merchantability and fitness for a particular purpose. However, such disclaimers must be conspicuous and specifically worded to be effective. For example, a disclaimer of the implied warranty of merchantability must mention 'merchantability' and, in the case of a written disclaimer, it must be conspicuous. Disclaimers of the implied warranty of fitness for a particular purpose must be in writing and conspicuous. Virginia law also requires that any limitations on consumers' rights be clearly and conspicuously disclosed. If a disclaimer or limitation of warranty is not in compliance with these requirements, it may be deemed ineffective, and the seller could be held liable for breach of warranty. It is important for parties to understand the risks involved in a transaction and the impact of any disclaimers before entering into a contract.