Express Warranty

Updated on January 2, 2024
Article byWallstreetmojo Team
Edited byAshish Kumar Srivastav
Reviewed byDheeraj Vaidya, CFA, FRM

What Is Express Warranty?

An express warranty is when it is explicitly stated either orally or in writing to guarantee any product or service’s quality or reliability. These promises include any representation of products, description of products/services, or statements of facts. In addition, it gives the right consumers to deal with the seller concerning the product’s performance and quality.

Express-Warranty

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Many of the purchases we make are covered by a warranty. A warranty is a promise made by the supplier/manufacturer to either replace or repair the product if it is faulty or not up to the quality assured. Warranties help to promote the product about its quality and reliability.

Key Takeaways

  1. An express warranty is explicitly stated orally or in writing to guarantee any product or a service’s quality or reliability. These promises include any representation of products, description of products/services, or statements of facts.
  2. This assurance obligates the seller that the given goods will comply with specification and sample when any contract is established with the expectation that the seller will supply the goods following the stated description or sample.
  3. Express warranties shield customers from poor quality or performance and allow them to sue the seller for compensation. Buyers should exercise caution when it comes to the warranties they receive.
  4. There has been a warranty breach; any express warranty offered is untrue. For consumer goods that cost more than a particular amount before the sale, warranty regulations contain clauses requiring written warranties to be provided.

How Does Express Warranty Work?

It is a statement of fact or promise made by the seller to the buyer relating to goods, which becomes part of the basis for buying or bargaining. It means that the purchase has been made based on the seller’s assumption that goods or services were as stated. The warranty statement made by the seller must be specific & subjective. It can be an affirmation or statement relating to goods, a description of the goods, or any sample. Also, the statement of opinions does not create any express warranty. The test of reliance concerning the reasonableness of promise should be looked into. When any contract is made based on the understanding that the seller would supply the goods as per the description stated or sample, the seller is bound by this warranty that the goods provided will conform to specification and sample.

In case of a full warranty, the seller promises to repair or replace the product at no charge to the consumer. In the case of a limited warranty, it covers all aspects which are not covered by a full warranty.

Electronic express warranty protects the consumer against the quality or performance and reserves the right to claim damages from the seller. However, a buyer must be careful concerning the warranties obtained. The buyer should try to obtain the written warranties. These warranties need not be in writing; oral statements could be relied on but are difficult to prove. Warranty laws allow some sales talks, usually called puffery or exaggeration. They don’t constitute a warranty.

Express and implied warranties are two different types of warranties available for the buyer. It is clearly expressed either in written or oral form by the seller, and any implied warranty is provided by law upon the sale of goods or services. Mere opinions or puffery cannot be construed as an express warranty.

In case of a breach of warranty, the onus of a breach is on the buyer. They have to prove the existence, scope, and manner of breach of a warranty to exercise their rights.

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Examples

Let us understand the concept of manufacturer express warranty with the help of a couple of examples as discussed below.

Example #1

Most purchases made by consumers are covered by a warranty. A warranty is a promise made by the supplier/manufacturer to either replace or repair the product if it is faulty or not up to the quality assured. Warranties help to promote the product about its quality and reliability. In addition, it gives the right consumers to deal with the seller concerning the product’s performance and quality.

This warranty is conveyed to the buyer in three possible ways:

  1. By any statement of fact or promise relating to the goods or services;
  2. By the description of goods or services;
  3. By use of any sample or model

When Aaron purchased a brand-new car, the dealer said, “This car’s engine would last for 200,000 miles with ease. That is the bare minimum before it could use some servicing”.

In this case, Aaron double checks with the dealer, who shows him the manufacturers’ express warranty.

Therefore, Aaron purchases the car.

Example #2

In February 2023, Bimbo Bakeries USA was hit with a class-action suit by a woman who claims that the “all butter” loaf cake is extremely misleading as the cake’s taste is derived from the vanilla essence and artificial additives that have been used.

The court found Bimbo Bakeries USA to have breached express warranty, implied warranty of fitness or merchantability, and the Magnuson Warranty Act.

Breach of Warranty

When there is any breach of warranty of any type, he has to prove the existence of a warranty. First, the scope of the warranty provides & how the seller has breached the warranty. In such a case, then the buyer can

  1. Rightfully reject the goods for nonconforming to the initial promise made by the seller and call for the cancellation of the contract.
  2. Accept the nonconforming goods and can recover the damages from the seller for breach of the warranty in the name of damages.
  3. If the seller fails to deliver the goods to the buyer, the buyer can exercise the same rights in case of a rejection or seek goods recovery.

It is a breach of manufacturer express warranty if any warranty expressed is false. Warranty laws contain provisions to provide written warranties for consumer products costing more than a certain amount before the sale. The seller has to put the written warranties along with the product or display any sign that warranties can be checked upon request. While selling their products and services, most companies provide a written list of warranties.

In case of any advertisement for a product, it should also tell the consumer how to obtain a copy of the warranty before buying the product. This includes all advertisements made via email or telephone.

Express Warranty Vs Implied Warranty

In a general scenario, both electronic express warranty and implied warranty go hand-in-hand. So much so that, they are often misunderstood for one another. Let us understand their differences through the discussion below.

#1 – Express Warranties

  1. The seller expressly makes these of the product.
  2. In most cases, these are provided in writing by the seller.
  3. These are not deemed warranties.

#2 – Implied Warranties

  1. The law creates these upon the sale of any goods or services.
  2. Implied warrantyImplied WarrantyAn implied warranty is either an oral or contractual legal term in any sale with the assurance that the product sold to the customer will meet their expectation & the purpose it needs to serve. It is not applicable for services.read more of merchantability states the product will perform for what it is designed for at a reasonable level.
  3. Implied warranty of fitness states that the product will work reasonably based on the assumptions or intention of the consumer.
  4. These are deemed warranties created by the law and are automatic upon sale.

If an express warranty exists, it shall not be construed that the implied warranty doesn’t exist. When both express and implied warranties are present, it should be assumed that both are consistent with each other and cumulative. If such an assumption is not reasonable, then express warranty prevails over the implied warranty except in the implied warranty of fitness for a particular purpose.

Frequently Asked Questions (FAQs)

What qualifies a warranty as express?

Any statement of fact or promise relative to the goods sold that forms a part of the foundation of the parties’ agreement and creates a warranty that the products will comply with the statement or promise constitutes an express warranty by the seller.

What about explicit warranties is accurate?

State law does not “read into” a sales contract any express promises, unlike implied warranties. Instead, during a sales transaction, sellers explicitly make these warranties available to their clients.

Can after-sale explicit warranties be given?

The UCC regards a guarantee as an explicit warranty if the seller makes it to the buyer regarding the goods after the sale has been completed and becomes a component of the basis of the agreement.

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