Definition
In common law jurisdictions, an implied warranty is a contract law term for certain assurances that are presumed to be made in the sale of products or real property, due to the circumstances of the sale. These assurances are characterized as warranties irrespective of whether the seller has expressly promised them orally or in writing. They include an implied warranty of fitness for a particular purpose, an implied warranty of merchantability for products, implied warranty of workmanlike quality for services, and an implied warranty of habitability for a home.
Implied Warranty
What is ‘Implied Warranty’
Under a sales contract, whether written or oral, there is a guarantee that the item sold is merchantable and fit for the purpose intended. This guarantee arises by operation of law and is in addition to any expressed warranties that are provided at the time of sale. These implied warranties exist to protect consumers who might otherwise pay for products that are not as represented by the merchant.
Explaining ‘Implied Warranty’
Most products you buy do not come with a written warranty. For example, when you go to the supermarket, you assume that the stocked items are fresh and edible. This is especially important when the food is prepackaged and you can’t visibly inspect it. In such cases, you are relying on the market’s implied warranties when you check out and pay your bill. If you get home and the milk is sour, you can expect to return it for a full refund.
Further Reading
- Toward a Theory of Warranties in Sales of New Homes: Housing the Implied Warranty Advocates, Law and Economics Mavens, and Consumer Psychologists Under … – heinonline.org [PDF]
- The Implied Warranty of Habituality as a Mechanism for Redistributing Income: Good Goal, Bad Policy – heinonline.org [PDF]
- The rise and fall of the implied warranty of habitability – www.jstor.org [PDF]
