Will this warranty-disclaimer / “AS IS” clause in a sale of goods hold up in Montana?
Yes, if it follows § 30-2-316's form requirements, and Montana courts do not layer any extra consumer-notice requirement on top of the statute. To exclude or modify the implied warranty of merchantability, “the language must mention merchantability and in case of a writing must be conspicuous”; to exclude the implied warranty of fitness, the exclusion “must be by a writing and conspicuous” (§ 30-2-316(2)). Separately, “all implied warranties are excluded by expressions like ‘as is’, ‘with all faults’ or other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty” (§ 30-2-316(3)(a)): a SEPARATE, self-executing safe harbor that does not need the “mention merchantability” language subsection (2) otherwise requires. Subsection (3) holds three more routes to the same place that have nothing to do with the words on the page: there is no implied warranty as to defects an examination should have revealed where the buyer “has examined the goods or the sample or model as fully as desired or has refused to examine the goods”; an implied warranty “can also be excluded or modified by course of dealing or course of performance or usage of trade”; and in sales of “cattle, hogs, sheep, or horses”, and of “any seed for planting”, there are no implied warranties of freedom from sickness, disease, virus or pathogens at all. Kopischke v. First Continental Corp. confirms the mechanics: “The phrase ‘as is’ is a statutorily approved method of excluding warranties,” controlled by § 30-2-316(3)(a). And McJunkin v. Kaufman & Broad Home Systems holds Montana imposes no unwritten extra hurdle: “Section 30-2-316, MCA, does not require that a disclaimer of implied warranties be specifically pointed out to the consumer”: it is enough that the disclaimer is “in larger, darker, bolder type” and “also capitalized and underlined,” even if the buyer never had it specifically flagged.
The trap
“Conspicuous” in McJunkin meant capitalized, underlined, and in larger/darker/bolder type than the surrounding text: a disclaimer buried in ordinary body text on the back of a form risks failing even though the statute does not require it be separately pointed out. Warranty of TITLE is a different animal: Brokke v. Williams holds that the “[w]arranty of title is not subject to the disclaimers found in” § 30-2-316, MCA, the section that governs fitness and merchantability: an “as is” clause aimed at merchantability and fitness does not reach a seller's warranty that it actually owns and can convey title. Title has its own section and its own, much narrower exclusion mechanics. § 30-2-312(1) supplies the warranty “[s]ubject to subsection (2)”, that “the title conveyed shall be good, and its transfer rightful” and that the goods arrive “free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge”; subsection (2) then lets it be “excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title”. Boilerplate aimed at implied warranties will not do it, and there is no “as is” safe harbour for title. Two more limits worth flagging: subsection (1) makes any negation “inoperative to the extent that such construction is unreasonable” against express warranty language the seller ALSO used: an “as is” clause does not cure an inconsistent express warranty elsewhere in the same deal; and subsection (4) ties warranty-breach REMEDIES back to §§ 30-2-718 and 30-2-719 (Montana's liquidated-damages and limitation-of-remedy statutes), so a disclaimer that survives § 30-2-316 does not by itself resolve what remedy, if any, remains.
11 authorities
The words that state the rule
Rogers v. Hilger Chevrolet Company, supra, it becomes necessary to determine what effect the “as is” clause has on such a duty. The phrase “as is” is a statutorily approved method of excluding warranties. The controlling statute is section 30-2-316(3) (a), MCA, which provides:
- case748 P.2d 910McJunkin v. Kaufman & Broad Home Systems, Inc.Mont.decided 1987read it at the source ↗
The words that state the rule
Section 30-2-316, MCA, does not require that a disclaimer of implied warranties be specifically pointed out to the consumer. In order to "exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and in case of a writing must be conspicuous. . .." Section 30-2-316(2), MCA. In the instant case, the disclaimer was not hidden in the fine print. The language was in larger, darker, bolder type. It was also capitalized and underlined.
The words that state the rule
Warranty of title is not subject to the disclaimers found in 5 30-2-316, MCA, pertaining to fitness and merchant- ability.
- statuteMont. Code Ann. § 30-2-312enactment date not established
The words that state the rule
A warranty under subsection (1) will be excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title or that the seller is purporting to sell only the right or title as the seller or a third person may have.
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
Subject to subsection (3), to exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and in case of a writing must be conspicuous, and to exclude or modify any implied warranty of fitness the exclusion must be by a writing and conspicuous. Language to exclude all implied warranties of fitness is sufficient if it states, for example, that "There are no warranties which extend beyond the description on the face hereof."
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
Notwithstanding subsection (2): (a) unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like "as is", "with all faults" or other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty;
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
Words or conduct relevant to the creation of an express warranty and words or conduct tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other; but subject to the provisions of this chapter on parol or extrinsic evidence ( 30-2-202 ) negation or limitation is inoperative to the extent that such construction is unreasonable.
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
Remedies for breach of warranty can be limited in accordance with the provisions of this chapter on liquidation or limitation of damages and on contractual modification of remedy ( 30-2-718 and 30-2-719 ).
- statuteMont. Code Ann. § 30-2-312enactment date not established
The words that state the rule
Subject to subsection (2) there is in a contract for sale a warranty by the seller that: (a) the title conveyed shall be good, and its transfer rightful; and (b) the goods shall be delivered free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge.
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
when the buyer before entering into the contract has examined the goods or the sample or model as fully as desired or has refused to examine the goods there is no implied warranty with regard to defects which an examination ought in the circumstances to have revealed to the buyer; (c) an implied warranty can also be excluded or modified by course of dealing or course of performance or usage of trade;
- statuteMont. Code Ann. § 30-2-316enactment date not established
The words that state the rule
in sales of cattle, hogs, sheep, or horses, there are no implied warranties, as defined in this chapter, that the cattle, hogs, sheep, or horses are free from sickness or disease; and (e) in sales of any seed for planting (including both botanical and vegetative types of seed, whether certified or not), there are no implied warranties, as defined in this chapter, that the seeds are free from disease, virus, or any kind of pathogenic organisms.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.