warranties ucc contract-law
Excluding Implied Warranties in Multi-national Contracts
<p>I am selling specialized industrial products to a Polish company who will use them at a site in Poland. We have hired a Polish lawyer to help us understand/exclude as many implied warranties as possible under Polish law, but have set the applicable law under the contract to New York state law.</p>
<p>Under US law, there are implied warranties as outlined by the <a href="https://www.law.cornell.edu/ucc" rel="nofollow noreferrer">UCC</a> (fitness for purpose and merchantability):</p>
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<p>“Unless excluded or modified, a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind.”</p>
<p>“Where the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods, there is unless excluded or modified under the next section an implied warranty that the goods shall be fit for such purpose.”</p>
</blockquote>
<p>For safety's sake, our lawyers have advised us to include the express warranties for merchantability and fitness of purpose in <strong>bold</strong> or ALL CAPS just in case, but during contract negotiations with our client they tell us that it is a typographical nightmare and they would kindly like us to remove the formatting so it doesn't look so hideous.</p>
<p>What risks (if any) should we be aware of taking on if we remove the formatting from this standard exclusion of warranties?</p>

<p><strong>I'm not a lawyer; I'm not <em>your</em> lawyer.</strong></p>
<p>It's difficult proving a negative. I can think of at least one case (in Australian real property law) where the formatting in contracts is prescribed, and deviation could render the contract void.</p>
<p><a href="https://www.law.cornell.edu/ucc/2/2-316" rel="nofollow noreferrer">UCC § 2-316</a> (&quot;the code&quot;) states that (emphasis mine):</p>
<blockquote>
<p>(2)Subject to subsection (3), to exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and <strong>in case of a writing must be conspicuous</strong>, and to exclude or modify any implied warranty of fitness the exclusion <strong>must be by a writing and conspicuous</strong>. Language to exclude all implied warranties of fitness is sufficient if it states, for example, that &quot;There are no warranties which extend beyond the description on the face hereof.&quot;</p>
<p>(3)Notwithstanding subsection (2)<br />
(a) unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like &quot;as is&quot;, &quot;with all faults&quot; or other language which in common understanding calls the buyer'sattention to the exclusion of warranties and makes plain that there is no implied warranty; and ...</p>
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<p>The code simply states that it must be conspicuous. Putting all in bold or all caps would certainly do that if it distinguished it from the rest of the text. I'm sure you can think of other ways to make text conspicuous.</p>
<p>If you remove this formatting from the exclusion and it is not otherwise conspicuous, the end user may be entitled to remedies.</p>
