Will this “AS IS, NO WARRANTIES” disclaimer defeat an implied-warranty claim in Nebraska?
Only if the buyer actually received it: conspicuous typography alone does not do it in Nebraska. The Nebraska UCC is NOT in the statutes we publish, so everything here is the Nebraska courts quoting the Code. The form requirement is Neb. U.C.C. § 2-316(2), quoted by the Supreme Court in Pfizer Genetics, Inc. v. Williams Management Co.: “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.” Two Nebraska rules then matter more than the typography. First, conspicuousness is a question for the judge, not the jury: in Adams v. American Cyanamid Co. the Court of Appeals held, on § 1-201(10) (“Whether a term or clause is ‘conspicuous’ or not is for decision by the court”), that “the trial court erred in submitting the issue of the label's conspicuousness to the jury”. Second, and this is the Nebraska rule that decides cases: “the mere fact that a disclaimer of the implied warranty of merchantability is conspicuous will not relieve a seller of liability if the buyer never receives the disclaimer”, so “in order for the disclaimer in the case at bar to be effective, the defendant must establish that the disclaimer came into Adams' possession, so that he had an opportunity to see and read the disclaimer or, at the least, that the terms of the disclaimer were brought to Adams' attention.” A disclaimer that is conspicuous and delivered can be good even though it is buried where the buyer did not look: Adams held a DISCLAIMER heading on the third page of a chemical label, reproduced in a manual, “was conspicuous as a matter of law”.
The trap
The Nebraska failure is delivery, not drafting. A perfectly conspicuous “AS IS — NO WARRANTY OF MERCHANTABILITY” that lives on a container the buyer never held, in a manual the buyer was never given, or on a web page the buyer was never shown, does nothing: Adams sent the case back for a new trial on two grounds, the submission of conspicuousness to the jury, and, as plain error, the failure to instruct on whether the buyer received the label. And the Court would not impute an agent's knowledge of the disclaimer to the purchaser: “the cases require that the disclaimer be presented to the purchaser if it is to become part of the bargain.” Second trap: timing. Pfizer Genetics observes that “The statute is silent as to when the disclaimer must be made”, and then DECIDES the point anyway, holding that disclaimers “made on or after delivery of the goods by means of an invoice, receipt, or similar note are ineffectual unless the buyer assents or is charged with knowledge as to the transaction”, a proposition it adopted as “both an equitable and logical interpretation of the Uniform Commercial Code, and should be followed in this case.” Adams’ receipt-and-opportunity requirement runs with it, so a late disclaimer dies on the rule and not on the silence. Third, and it is the trap that must be stated plainly: the Nebraska UCC is ABSENT from the statutes we publish, and the Revised Statutes numbers COLLIDE with it. A search for Nebraska's § 2-316 returns nothing, and § 2-302 returns an Agriculture section whose subject is community gardens and whose heading is about legislative findings, legislative intent and the purpose of that act, nothing to do with unconscionability. Anything cited to you as “Neb. Rev. Stat. § 2-316” is wrong. The Code sections here are cited as Neb. U.C.C. and carried by Nebraska opinions quoting them, which is the only route this rule honestly supports. Fourth, the “as is” branch: neither Pfizer Genetics nor Adams decides it, but Nebraska law does. § 2-316(2) opens “Subject to subsection (3)” in the text Adams quotes, and § 2-316(3)(a) is what makes “as is” and “with all faults” work in the uniform Code. The Nebraska Supreme Court HAS applied it: in Wilke v. Woodhouse Ford a conspicuous used-vehicle disclaimer of the implied warranty of merchantability “met the requirements of” § 2-316(2) and (3)(a) “for excluding an implied warranty of merchantability”, and the court concluded that “Woodhouse effectively disclaimed all implied warranties, including the warranty of merchantability.” Koperski v. Husker Dodge reproduces subsection (3)(a) itself. What is still unlocated is any Nebraska decision on § 2-316(3)(b)'s examination branch, so a clause that rests on the buyer's examination is unsupported here.
16 authorities
- case281 N.W.2d 536Pfizer Genetics, Inc. v. Williams Management Co.Neb.decided 1979read it at the source ↗
The words that state the rule
The relevant portion provides that ‘ ‘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.
- case281 N.W.2d 536Pfizer Genetics, Inc. v. Williams Management Co.Neb.decided 1979read it at the source ↗
The words that state the rule
Section 2-316, U. C. C., pertains to the exclusion or modification of warranties.
- case281 N.W.2d 536Pfizer Genetics, Inc. v. Williams Management Co.Neb.decided 1979read it at the source ↗
The words that state the rule
The statute is silent as to when the disclaimer must be made.
The words that state the rule
Section 1-201(10) reads: “Whether a term or clause is ‘conspicuous’ or not is for decision by the court.” On the basis of § 1-201(10), we hold that the trial court erred in submitting the issue of the label’s conspicuousness to the jury. However, such error would be prejudicial only if it adversely affected the defendant’s substantial rights. Since the defendant would have a substantial right affected only if the disclaimer is conspicuous as a matter of law, we first resolve that issue and then return to whether prejudice arose from the jury instruction.
The words that state the rule
the heading “DISCLAIMER” is prominently displayed. The disclaimer is sufficiently set off from other material so as to draw attention to itself. Also, the disclaimer is on the third page of the label, although the record establishes that the only label presented to Adams was contained in a manual. Therefore, *349 notwithstanding the fact that the label appears in a manual, we hold that the disclaimer was conspicuous as a matter of law.
The words that state the rule
It is clear from these cases that the mere fact that a disclaimer of the implied warranty of merchantability is conspicuous will not relieve a seller of liability if the buyer never receives the disclaimer.
The words that state the rule
Therefore, we hold that in order for the disclaimer in the case at bar to be effective, the defendant must establish that the disclaimer came into Adams’ possession, so that he had an opportunity to see and read the disclaimer or, at the least, that the terms of the disclaimer were brought to Adams’ attention. On remand, the court is directed to so instruct the jury.
The words that state the rule
Even if Johnson was the agent of the Adamses, which we need not decide, the cases require that the disclaimer be presented to the purchaser if it is to become part of the bargain.
The words that state the rule
Conversely, if a disclaimer is conspicuous, it is effective so long as the buyer receives the disclaimer and has a reasonable opportunity to read it.
The words that state the rule
Neb. U.C.C. § 2-316(2) (Reissue 1980) reads: 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
- case281 N.W.2d 536Pfizer Genetics, Inc. v. Williams Management Co.Neb.decided 1979read it at the source ↗
The words that state the rule
Although this court has not specifically addressed the question, other jurisdictions have generally held that disclaimers or warranty made on or after delivery of the goods by means of an invoice, receipt, or similar note are ineffectual unless the buyer assents or is charged with knowledge as to the transaction.
- case281 N.W.2d 536Pfizer Genetics, Inc. v. Williams Management Co.Neb.decided 1979read it at the source ↗
The words that state the rule
The above proposition of law is both an equitable and logical interpretation of the Uniform Commercial Code, and should be followed in this case.
The words that state the rule
Not only was the defendant prejudiced by the court’s submission of the issue of conspicuousness to the jury, but the failure of the district court to instruct on the issue of Adams’ receipt of the disclaimer is plain error indicative of a probable miscarriage of justice. We therefore remand the cause for a new trial.
The words that state the rule
The purchase agreement evidencing the sale of the van from Woodhouse to the Wilkes included a conspicuous statement that it was sold "as is," "without any warranty either expressed or implied," and further stated that Woodhouse was disclaiming any implied warranty of merchantability. This language met the requirements of 2-316(2) and (3)(a) for excluding an implied warranty of merchantability.
The words that state the rule
We conclude that Woodhouse effectively disclaimed all implied warranties, including the warranty of merchantability.
The words that state the rule
In addition, we note that § 2-316(3) provides in part: “(3) 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 . . . .
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.