Will our warranty disclaimer be enforced in Virginia?
Yes if it is conspicuous, and the court decides that, not the jury. "To limit either warranties or remedies, however, the exclusionary language in the writing must be 'conspicuous.' Code § 8.2-316(2). Whether a provision is conspicuous is a question of law for a court", and "A provision is deemed to be conspicuous when 'it is so written that a reasonable person against whom it is to operate ought to have noticed it'" (Armco, Inc. v. New Horizon Development Co., quoting Code § 8.1-201(10), which also gives the example that language in the body of an agreement "is conspicuous if it is written in 'larger or other contrasting type or color'"). Armco also decides the Virginia-specific type-size question, and the answer is the one a drafter needs: Va. Code § 11-4 requires that a printed form contract for "the sale and future delivery of any goods or chattels, machinery or mechanical devices, or personal property of any kind or sort whatsoever" be "clearly and plainly printed or written" with the vendor's stipulations "in type of not less than the size known as ten point" and a no-verbal-agreement stipulation printed as a separate paragraph "in type not smaller than pica", and the disclaimer in Armco did NOT meet it, but the Court held that "Code § 11-4 is inconsistent with the U.C.C. provision requiring that a limiting term or clause need be only conspicuous" and so "the provisions of Code § 11-4 do not apply to this U.C.C. transaction". Because the excluding language was in larger type, "we hold as a matter of law that it is conspicuous", and the Court reversed and entered final judgment for the seller. For a new dwelling as § 55.1-357(A) defines it (which excludes condominium units and dwellings built solely for lease) the answer is governed by statute and the formalities are exact. Va. Code § 55.1-357(C) implies, in every contract for the sale of a new dwelling by a vendor in the business of building or selling them, that the dwelling is "sufficiently (i) free from structural defects, so as to pass without objection in the trade; (ii) constructed in a workmanlike manner, so as to pass without objection in the trade; and (iii) fit for habitation". Subsection (D) then allows a waiver only on four conditions at once: "A contract for sale may waive, modify, or exclude any or all express and implied warranties and sell a new home 'as is' only if the words used to waive, modify, or exclude such warranties are conspicuous, as defined by subdivision (b)(10) of § 8.1A-201, set forth on the face of such contract in capital letters that are at least two points larger than the other type in the contract and only if the words used to waive, modify, or exclude the warranties state with specificity the warranty or warranties that are being waived, modified, or excluded. If all warranties are waived or excluded, a contract shall specifically set forth in capital letters that are at least two points larger than the other type in the contract that the dwelling is being sold 'as is.'"
The trap
A general "as is" line does not waive the new-home warranty in Virginia. Section 55.1-357(D) requires the waiver to be conspicuous, on the face of the contract, in capitals at least two points larger than the rest of the type, AND to state with specificity which warranty is being waived: four separate requirements, any one of which will sink an ordinary disclaimer. Three more things the section does that the drafter on either side needs. Subsection (B) gives EVERY vendor of a new dwelling a warranty, but only "to the best of the actual knowledge of the vendor"; the unqualified warranty in (C) is the builder-vendor's. Subsection (E) makes a written pre-suit notice by certified mail, overnight service or receipted hand delivery a condition of the claim, and gives the vendor a reasonable time "not to exceed six months" to cure. Subsection (F) runs the warranty one year from transfer of record title or possession, five years for the builder's foundation warranty, and the action must be brought within TWO years of the breach, with the (E) notice tolling that period six months. The second trap is the one Robberecht states for every disclaimer: "A buyer can show that a contract of sale was induced by the seller's fraud, notwithstanding the fact the sale was made 'as is'", so a conspicuous disclaimer still does not answer a fraud claim.
12 authorities
- case229 Va. 561Armco, Inc. v. New Horizon Development Co. of VirginiaVa.decided 1985read it at the source ↗
The words that state the rule
To limit either warranties or remedies, however, the exclusionary language in the writing must be “conspicuous.” Code § 8.2-316(2). Whether a provision is conspicuous is a question of law for a court.
- case229 Va. 561Armco, Inc. v. New Horizon Development Co. of VirginiaVa.decided 1985read it at the source ↗
The words that state the rule
A provision is deemed to be conspicuous when “it is so written that a reasonable person against whom it is to operate ought to have noticed it.” Code § 8.1-201(10). For example, language con *566 tained in the body of an agreement is conspicuous if it is written in “larger or other contrasting type or color.” Id.
- statuteVa. Code § 55.1-357enactment date not established
The words that state the rule
In addition, in every contract for the sale of a new dwelling, the vendor, if he is in the business of building or selling such dwellings, shall be held to warrant to the vendee that, at the time of transfer of record title or the vendee's taking possession, whichever occurs first, the dwelling together with all of its fixtures is sufficiently (i) free from structural defects, so as to pass without objection in the trade; (ii) constructed in a workmanlike manner, so as to pass without objection in the trade; and (iii) fit for habitation.
- statuteVa. Code § 55.1-357enactment date not established
The words that state the rule
D. The warranties described in subsections B and C implied in the contract for sale shall be held to survive the transfer of title. Such warranties are in addition to, and not in lieu of, any other express or implied warranties pertaining to the dwelling or its materials or fixtures. A contract for sale may waive, modify, or exclude any or all express and implied warranties and sell a new home "as is" only if the words used to waive, modify, or exclude such warranties are conspicuous, as defined by subdivision (b)(10) of § 8.1A-201 , set forth on the face of such contract in capital letters that are at least two points larger than the other type in the contract and only if the words used to waive, modify, or exclude the warranties state with specificity the warranty or warranties that are being waived, modified, or excluded. If all warranties are waived or excluded, a contract shall specifically set forth in capital letters that are at least two points larger than the other type in the contract that the dwelling is being sold "as is."
- case220 Va. 109George Robberecht Seafood, Inc. v. Maitland Bros. Co.Va.decided 1979read it at the source ↗
The words that state the rule
A buyer can show that a contract of sale was induced by the seller’s fraud, notwithstanding the fact the sale was made “as is”. 1 R. Anderson, Uniform Commercial Code § 2-316:35 (2d. ed. 1970). The same is true even though the written contract contains covenants waiving warranties or disclaiming or limiting liabilities.
- statuteVa. Code § 55.1-357enactment date not established
The words that state the rule
B. In every contract for the sale of a new dwelling, the vendor shall be held to warrant to the vendee that, at the time of the transfer of record title or the vendee's taking possession, whichever occurs first, the dwelling with all of its fixtures is, to the best of the actual knowledge of the vendor or his agents, sufficiently (i) free from structural defects, so as to pass without objection in the trade, and (ii) constructed in a workmanlike manner, so as to pass without objection in the trade.
- statuteVa. Code § 55.1-357enactment date not established
The words that state the rule
E. If there is a breach of warranty under this section, the vendee, or his heirs or personal representatives in case of his death, shall have a cause of action against his vendor for damages, provided, however, for any defect discovered after July 1, 2002, such vendee shall first provide the vendor, by certified mail at his last known address, or by commercial overnight delivery service or the United States Postal Service, and a receipt obtained, a written notice stating the nature of the warranty claim. Such notice also may be hand delivered to the vendor with the vendee retaining a receipt of such hand-delivered notice to the vendor or its authorized agent. After such notice, the vendor shall have a reasonable period of time, not to exceed six months, to cure the defect that is the subject of the warranty claim. F. The warranty shall extend for a period of one year from the date of transfer of record title or the vendee's taking possession, whichever occurs first, except that the warranty pursuant to clause (i) of subsection C for the foundation of new dwellings shall extend for a period of five years from the date of transfer of record title or the vendee's taking possession, whichever occurs first. Any action for its breach shall be brought within two years after the breach thereof. For all warranty claims arising on or after January 1, 2009, sending the notice required by subsection E shall toll the limitations period for six months.
- case229 Va. 561Armco, Inc. v. New Horizon Development Co. of VirginiaVa.decided 1985read it at the source ↗
The words that state the rule
This brings us to the central issue in this appeal: whether the provisions of the U.C.C. or Code § 11-4 2 govern the type-size requirements for the contract. As previously noted, the U.C.C. requires only that the excluding language be conspicuous, Code § 8.2-316(2), and language is conspicuous when it is written in larger type, Code § 8.1-201(10). Because the excluding language *567 in the contract is in larger type, we hold as a matter of law that it is conspicuous. The type size, however, does not meet the requirements of Code § 11-4 which was in effect prior to the U.C.C. For this reason, the trial court ruled that the exclusions were unenforceable. We hold that the court erred. Under the facts of this case, Code § 11-4 is inconsistent with the U.C.C. provision requiring that a limiting term or clause need be only conspicuous. Thus, the provisions of Code § 11-4 do not apply to this U.C.C. transaction. See Code § 8.10-103.
- case229 Va. 561Armco, Inc. v. New Horizon Development Co. of VirginiaVa.decided 1985read it at the source ↗
The words that state the rule
We conclude, therefore, that because the limiting language of the contract was conspicuous within the meaning of the U.C.C., the court erred in submitting the issues of express and implied warranties to the jury. Accordingly we will reverse the judgment of the trial court and enter final judgment for Armco.
- statuteVa. Code § 11-4enactment date not established
The words that state the rule
No contract in writing entered into between a citizen of this Commonwealth and any person, firm, company or corporation, domestic or foreign, doing business in this Commonwealth, for the sale and future delivery of any goods or chattels, machinery or mechanical devices, or personal property of any kind or sort whatsoever, shall be binding upon the purchaser, where the form is printed and furnished by the person, firm, company or corporation, unless all of the provisions of such contract are clearly and plainly printed or written; and, where printed, such provisions and covenants and all stipulations as to the rights of the vendor shall be in type of not less than the size known as ten point; and, wherever in such contract, printed upon a form furnished by the vendor, it is stipulated that the vendor is not to be bound by any verbal agreement or modification of the terms of such printed contract, then such stipulation shall be printed as a separate paragraph or paragraphs and in type not smaller than pica.
- case220 Va. 109George Robberecht Seafood, Inc. v. Maitland Bros. Co.Va.decided 1979read it at the source ↗
The words that state the rule
We hold that the trial court erred in entering summary judgment on the pleadings, and we will reverse the judgment order and remand the case for a trial on the merits.
- statuteVa. Code § 55.1-357enactment date not established
The words that state the rule
A. As used in this section: "New dwelling" means a dwelling or house that has not previously been occupied for a period of more than 60 days by anyone other than the vendor or the vendee or that has not been occupied by the original vendor or subsequent vendor for a cumulative period of more than 12 months, excluding dwellings constructed solely for lease. "New dwelling" does not include a condominium or condominium units created pursuant to the Virginia Condominium Act (§ 55.1-1900 et seq.). "Structural defects" means a defect or defects that reduce the stability or safety of the structure below accepted standards or that restrict the normal use of the structure.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.