Millions of transactions for goods and services occur every day. In most of these transactions, there are few express warranties. The reason this is true is because sellers know the problems it can cause to say something about a good or service that turns out to be wrong. This is something that you probably already know.
What’s important is that there are some nuances when it comes to express warranties and I want to share with you some business practices to avoid so that you don’t find yourself facing a breach of warranty lawsuit.
Opinions don’t count. Feel free to embellish or brag about how good your products or services are, as this does not count as an express warranty. Factual representations do. You may have heard about the Subway sandwich controversy where a lawsuit was brought because of Subway’s claim that their sandwiches were a foot long. Turns out they were really only 11 inches. Subway settled and promised to make sure their sandwiches were 12 inches. Would have been much safer to offer the opinion ‘fantastic sandwich.’
Consider the worst-case scenario. At the car wash, I recently saw advertised unlimited washes for $14.95 a month. Imagine somebody who wants to make a social media video by going through the car wash 1000 times in a month. About time 250 you say no more. You may not have envisioned such a scenario and advertised accordingly. You will be held to the advertisement and any attempt to interfere could find you facing a lawsuit. Always consider the worst-case scenario.
No special words required. An express warranty can be based on something you show or have a client touch. A painter could show a color sample or musician could play music chords. Each represents a sample of a product or service the client would get and any deviations could result in a breach of warranty lawsuit.
As consumers, we are generally very familiar with express warranties and often make our purchasing decisions on such warranties. For sellers of goods, it’s really important to be as familiar with implied warranties as with express. Nearly all litigation surrounding warranties focuses on implied warranties and a seller can more easily protect against lawsuits based on implied warranties than express warranties.
First, consider that nearly all of our purchases do not involve interacting with a person wherein most express warranties arise. Look at a shopping cart next time you’re in the store. A full cart may contain 50-80 items. You’d be hard pressed to find an item with an express warranty, but each one automatically comes with an implied warranty.
However, unlike express warranties where we generally understand that if you guarantee something it had better perform, implied warranties are less obvious.
In your shopping cart, imagine you have the following items: tin foil, a corkscrew, and oven mitten. You prepare a casserole and cover it with the foil. The timer goes off twenty minutes later and you grab the oven mitten to take it out of the oven. To your dismay, the foil has all but disintegrated ruining your casserole. Mad, you grab the dish and immediately the razor-sharp heat pierces the mitten burning your hand. Once you recover after cooling your hand with ice…it’s time for wine. You grab the new opener and plunge the corkscrew into the cork. Halfway out, the opener breaks. Finally, you decide to go out to eat.
I’m sure we all can appreciate scenarios like this. What you may not have realized is that in each instance the implied warranty of merchantability was breached. None of the products performed as you would have expected them to perform under normal conditions.
Let’s say at the grocery store a person is demonstrating a juicer. Seems to work fantastic and you are very interested, but for another reason. You are a painter and you want to extract color pigments from various plants. You approach the salesperson and tell them what you are interested in doing. They tell you that you should have no problem extracting reds from your favorite roses and tulips and oranges from poppies. Anxious, you take it home and run it through its paces. Unfortunately, the only colors you get are blends all shaded in brown. While not used in a typical manner, you specifically shared what you wanted the product for and bought it based on that use. Here the implied warranty of fitness for a particular purpose was breached. Also, you may have an express warranty claim.
While none of these examples have folks running to the courthouse, what about the car manufacturer that makes faulty airbags resulting in death? Liability in part is based on implied warranties. Because some warranties automatically exist, small businesses often forget to address these when selling products or services. However, because so many lawsuits are based on breach of warranty, it must be a foremost consideration for all business owners.