Understanding Warranty Clauses:A Legal Guide – Договірні гарантії: юридичний путівник – Оксана Кіріяк
Про договірні гарантії розповіла кандидат юридичних наук, доцент Чернівецький національний університет імені Юрія Федьковича Оксана Кіріяк під час заходу з підвищення кваліфікації адвокатів, що відбувся у Вищій школі адвокатури НААУ.
Кіріяк Оксана
05.02.2025

Лектор докладно проаналізувала разом з учасниками договірні гарантії, а саме:

  • 1. Introduction to the Warranty Clausе – загальна характеристика застереження про гарантію.
  • 2. Legal Framework for the Warranty Clausе – нормативне регулювання гарантії.
  • 3. Key Components of the Warranty Clausе – Ключові елементи гарантійних положень.
  • 4.Best Practices in Drafting and Negotiating the Warranty Clausе – поради у формулюванні та обговоренні гарантійних положень.

У рамках договірних гарантійакцентовано на наступному:

  1. IntroductiontotheWarrantyClausе – загальна характеристика застереження про гарантію

A Warranty Clause is a provision in a contract where one party guarantees certain facts or conditions about the subject matter of the agreement. It assures the other party that specific statements are true or will be met, and if they are not, the breaching party may be liable for damages.

Warranty clauses protect the interests of both parties by establishing clear expectations and legal remedies in case the warranted conditions are not fulfilled.

Warranty clauses are crucial in contracts as they provide a legal assurance that specific conditions or statements are true, helping to establish trust between parties.

In civil law systems, warranties are primarily statutory and implied by codified laws, while in common law systems, they are largely contractual, relying on explicit terms and judicial precedents.

  1. Legal Framework for the Warranty Clausе – нормативнерегулюваннягарантії

Origin and Evolution of ‘Warranty’: A Linguistic and Legal Perspective

The morphological construction combines:

  • 1) “war-/guar-“: from the Germanic root meaning “defend” or “ensure.“
  • 2) “-ant”: a nominal suffix common in Old French.
  • 3) «-y»: a suffix denoting a state, condition, or quality, signaling the term’s abstract nature.

The term «warranty» has its origins in the Anglo-Norman and Old French word «warantie,» which referred to a guarantee or pledge of security. Its root can be traced back to the Proto-Germanic «warjanan,» meaning «to protect, defend, or guard.» This etymology reflects its early usage in the context of feudal law and property agreements, where it signified an assurance or safeguard against loss or failure.

In medieval English, the word evolved alongside the related term «guarantee,» both derived from similar linguistic roots but used in slightly different legal contexts. While «warranty» became more associated with formal, contractual obligations, «guarantee» often retained a broader, less formal sense of assurance.

Thus, warranty embodies a legal and linguistic history tied to promises of security and responsibility in commercial and property law..

  1. Key Components of the Warranty Clausе – Ключовіелементигарантійнихположень

Quarantee vs Warranty

For nuanced uses, terms may overlap depending on jurisdiction and context, but their enforceability and purpose distinguish them.

  • Guarantee – A promise of quality or performance offered by the seller or manufacturer, often broader and informal. It represents assurance that a product will meet specified standards or be repaired/replaced if it fails. Can serve as a collateral promise; often linked with services or intangible performance aspects. Example: “Satisfaction guaranteed or your money back!”
  • Warranty – A legally binding agreement specifying the terms under which a product or service will be repaired, replaced, or refunded if it is defective within a given timeframe. Commonly associated with goods or tangible products. Example: “This car comes with a 3-year/36,000-mile warranty against manufacturing defects.”

Warranty vs. Support vs. Maintenance: Understanding the Differences

Warranty – a warranty is a contractual promise ensuring that a product or service meets specified standards, with remedies like repair, replacement, or compensation in case of defects or non-conformance.

Technical Support – support focuses on assisting users with issues or questions related to the operation, usage, or functionality of a product or service.

Maintainance – Maintenance involves proactive efforts to ensure a product or system remains operational and efficient by preventing or addressing potential issues.

While a warranty is a contractual assurance that a product or service will meet certain standards or perform as promised, support and maintenance involve ongoing services to ensure the product continues to function properly and address any issues post-delivery, often beyond the warranty period.

In a Warranty Clause, the main parties involved are:

  • Warrantor: The party who provides the warranty, guaranteeing that certain facts, conditions, or obligations are true or will be met. The warrantor is responsible for any breach of the warranty and may be liable for damages if the warranty is not fulfilled.
  • Beneficiary (or Warrantee): The party receiving the warranty, who relies on the statements or conditions guaranteed by the warrantor. If the warranty is breached, the beneficiary is entitled to seek legal remedies, such as compensation for losses.
  1. Best Practices in Drafting and Negotiating the Warranty Clausе – порадиуформулюваннітаобговореннігарантійнихположень
  1. The three main features of warranty clauses are:
  1. Assurance of Accuracy: They guarantee that specific facts or conditions in the contract are true and accurate.
  1. Risk Mitigation: They protect the beneficiary by providing legal remedies in case the warrantor fails to meet the guaranteed obligations.
  1. Breach Consequences: They outline the potential liabilities or damages if the warranty is breached, ensuring accountability.

Here are five procedural steps typically involved in warranty clauses:

  1. Drafting the Warranty: Clearly define the facts, conditions, or obligations that are being guaranteed by the warrantor in the contract.
  1. Risk Allocation: Outline any specific risks covered by the warranty and the circumstances under which the warrantor will be held liable for breach.
  1. Representation of Facts: The warrantor confirms or represents the accuracy of the stated facts or conditions at the time of the contract.
  1. Notification of Breach: Establish a procedure for the beneficiary to notify the warrantor if there is a breach of the warranty.
  1. Remedies for Breach: Specify the legal remedies or compensation the beneficiary is entitled to in case the warranty is not fulfilled, such as indemnification or damages.

Best Practices for Drafting and Negotiating Warranty Clauses:

When drafting and negotiating warranty clauses, ensure clarity by explicitly defining the scope of the warranty and the obligations being guaranteed to avoid ambiguities. Include specific remedies and limitations to manage risk, such as indemnification for potential losses, while ensuring they are reasonable for both parties. Additionally, clearly outline the process for notifying breaches and set time limits for when claims can be made, providing a fair balance between protection and responsibility.

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