Seller Beware: Warranty Disclaimers and the Unfair Trade Practices Act
By: Rudman Winchell Attorney Allison A. Economy
Maine law prohibits unfair methods of competition and unfair practices under the Unfair Trade Practices Act (the “Act”). The Act is particularly stringent when it comes to warranties offered in connection with the sale or manufacture of consumer goods. Consumer goods are those used primarily for personal, family, or household purposes, and may include anything from small items like groceries to big ticket items like televisions and cars.
Anytime goods are sold in Maine, the seller or manufacture makes certain warranties with respect to those goods, whether the warranties are in writing (known as express warranties) or not (known as implied warranties).
There are two types of implied warranties associated with the sale of goods – the warranty of merchantability and the warranty of fitness for a particular purpose.
The warranty of merchantability provides that if the seller is a merchant with respect to goods of that kind (i.e., a home improvement that sells saws), the goods sold shall be merchantable (i.e., the saw should be able to cut the type of wood it is intended to cut).
The warranty of fitness for a particular purpose provides that when a buyer is relies on a seller’s skill or judgment to select the goods, and the seller has reason to know that the goods will be used for a particular purpose, the seller gives an implied warranty that the goods will be fit for that purpose. For instance, if a consumer goes into a sporting goods store and the employee helps her in selecting a bicycle helmet for her child, the seller has given an implied warranty that the helmet will offer some protection to the child riding the bike.
In addition to these implied warranties, and particularly with respect to big ticket items, sellers or manufacturers often also offer express warranties. These express warranties guaranty that the product will perform to a certain standard for a certain length of time. Problems arise, however, when the express warranties attempts to limit warranties that are already implied in the sale of such goods.
For instance, it is a violation under the Act to purport to (a) limit a person’s rights to damages for breach of any implied warranty rights if the defective item is a consumer good or (b) disclaim the warranty of fitness for a particular purpose with respect to any new or used consumer good.
If a seller or manufacturer attempts to limit or disclaim any implied warranties, it may be liable for damages to any consumer who purchases goods and suffers any loss of money or property by virtue of the limitation or disclaimer. The consumer has six years to bring an action against the seller or manufacturer, so this cause of action may long outlast any express warranty associated with the goods.