What Is the Warranty of Merchantability?

The implied warranty of merchantability guarantees that a product sold to you will work for its intended purposes. In other words, it means you can expect a toaster to toast your bread. If it doesn't, you have legal protection against losing money on a product that doesn't work.

The warranty of merchantability is based on the idea that the seller should know best whether a product will perform properly. It encourages them to ensure the quality of their product before placing it on the market. After all, a seller is better positioned than a customer to know whether its toaster runs too cold.

Does This Warranty Have To Be In Writing?

No, the implied warranty of merchantability is not a written warranty. Not all types of warranties must be in writing. This warranty type exists without a retailer saying or writing it, unlike an express warranty.

A seller doesn't have to tell you that its product will work on a basic level, nor must they include it in a sales contract. Instead, the law creates this warranty for most consumer products on the market.

Implied Warranty of Merchantability Laws

An implied warranty of merchantability guarantees that a product will work as expected. But “as expected" can mean many things to customers and sellers. That's why state laws define how products might meet, or miss, expectations.

The Uniform Commercial Code (UCC) is the model for most state laws on consumer protection. It lists several implied guarantees. Most states set similar standards for merchantability. For example, Texas law creates the same guarantees as New York law. This warranty applies to the goods of any seller who deals in that type of merchandise on a regular basis.

These laws leave ample room for interpretation. A court would consider the specific facts of a case and the product's qualities to decide whether it violates the warranty.

What Does the Implied Warranty of Merchantability Guarantee?

Under UCC § 2-314, as adopted in state laws, this warranty guarantees that the product you buy will:

• Pass without objection in the trade by meeting general industry standards
• Be of uniform quality and quantity
• Be fit for its ordinary purposes, such as a microwave being fit to heat food
• Be adequately packaged and labeled
• Conform to its labels

For example, the quality of a car available for purchase must be decent enough that other car salespeople would not object to it. It must also work well enough for its usual purpose: transportation. The car should also have the necessary labels.

Some cars might fail to meet these basic requirements. They may be mislabeled, perhaps with the wrong model or year, or fail to get you from place to place. The buyer can show a breach of the implied warranty of merchantability. This warranty is part of the many lemon laws for vehicles.

Products Should Work for Their Intended Purpose

A product that fails to work for normal use is a breach of warranty of merchantability. Most disagreements revolve around whether the use of a product matches its intended purpose or ordinary use.

This warranty is different from an implied warranty of fitness. A fitness warranty changes the guarantee from the intended purpose to a particular purpose instead. Sellers create this warranty when a customer explains how they want to use a product, and the seller implies it will work for that use.

Example of How a Product Can Fail Its Intended Purpose

Imagine you purchase an oven intended for household baking. If you put it in a commercial kitchen, you'll use it for something other than its intended purpose. It might lack the right consistency or size to support large batches of baked goods. The seller would not be responsible for such issues.

If your oven's actual temperature is far from the heat setting you pick, that's a different problem. No matter where you'd bake, you couldn't rely on it to work for that purpose.

You may show that the oven would be faulty for ordinary use at home. Despite buying it for commercial purposes, you could argue that it violated the implied warranty of merchantability.

Does the Warranty of Merchantability Cover Used Goods?

Yes, the warranty of merchantability can cover new and used goods. Used goods still have an implicit guarantee they'll work for their intended purposes.

Most states add an extra consideration for buying secondhand items: their resale condition. Used goods don't need to work as well as new ones under warranty laws. You should still expect a used item to function based on its current state.

The warranty for used goods prevents sellers from peddling faulty products. For example, a secondhand sofa you bought shouldn't collapse when you sit down. Signs of wear on its fabric might not breach the implied warranty.

Products Sold As Is or With Disclaimers

The implied warranty of merchantability might not apply to all consumer purchases. Some states allow merchants to avoid this warranty by using disclaimers or selling the product “as is."

In most states, the disclaimer must be visible in writing to be valid. The buyer must know that the warranty won't cover the product. A seller can do this by listing the product for sale as is in its advertisement or label.

Many states don't allow merchants to avoid implied warranties for consumer goods. In these states, disclaimers like as is are essentially meaningless. If a product doesn't work as intended, you could still return it despite the disclaimer.

Legal Advice for Products Violating Warranty Laws

The implied warranty of merchantability covers purchases in all states, but legal specifics can vary by location because the warranty isn't based on a consistent federal law. The circumstances of your case can also affect whether a breach of warranty occurred.

If you purchased a product unfit for its typical use, consider contacting a consumer protection lawyer. They can examine the consumer protection laws in your state and discuss your options. You can also report faulty products and scams to the Federal Trade Commission (FTC).