Nebraska Uniform Commercial Code 2-316

UCC 2-316

2-316.

Exclusion or modification of warranties.

(1) 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 article on parol or extrinsic evidence (section 2-202) negation or limitation is inoperative to the extent that such construction is unreasonable.

(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 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."

(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; and

(b) when the buyer before entering into the contract has examined the goods or the sample or model as fully as he 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 him; and

(c) an implied warranty can also be excluded or modified by course of dealing or course of performance or usage of trade; and

(d) with respect to the sale of cattle, hogs, and sheep, there shall be no implied warranty that the cattle, hogs, and sheep are free from disease.

(4) Remedies for breach of warranty can be limited in accordance with the provisions of this article on liquidation or limitation of damages and on contractual modification of remedy (sections 2-718 and 2-719).

Source

  • Laws 1963, c. 544, Art. II, § 2-316, p. 1724;
  • Laws 1976, LB 536, § 1.

Annotations

  • 1. Exclusion of warranty

  • 2. Applicability of section

  • 3. Implied warranty

  • 4. Miscellaneous

  • 1. Exclusion of warranty

  • The use of an "as is" clause to exclude the implied warranty of merchantability cannot be against the public policy of this state when it mirrors the statutory requirements specifically allowing for such exclusion. Wilke v. Woodhouse Ford, 278 Neb. 800, 774 N.W.2d 370 (2009).

  • Under Neb. U.C.C. section 2-316(3), 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. Koperski v. Husker Dodge, Inc., 208 Neb. 29, 302 N.W.2d 655 (1981).

  • Disclaimers of warranty made at or after delivery of the goods by means of an invoice, receipt, or similar document are ineffective unless the buyer assents or is charged with knowledge as to the transaction. Pfizer Genetics, Inc. v. Williams Management Co., 204 Neb. 151, 281 N.W.2d 536 (1979).

  • This statute restricts the effect of language attempting to limit or negate an express warranty. Neville Const. Co. v. Cook Paint and Varnish Co., 671 F.2d 1107 (8th Cir. 1982).

  • 2. Applicability of section

  • Discussed in opinion holding Uniform Commercial Code applicable rather than strict tort liability in case involving damage to all property. Hawkins Constr. Co. v. Matthews Co., Inc., 190 Neb. 546, 209 N.W.2d 643 (1973).

  • 3. Implied warranty

  • Where seller had reason to know particular purpose for which goods were required and that buyer was relying on seller's skill to furnish suitable goods, there was an implied warranty unless excluded or modified under this section. Shotkoski v. Standard Chemical Manuf. Co., 195 Neb. 22, 237 N.W.2d 92 (1975).

  • Where seller at time of contracting has reason to know a particular purpose for which goods are required, and that buyer is relying on seller's skill or judgment to select or furish suitable goods, there is, unless excluded or modified under this section, an implied warranty that the goods shall be fit for such purpose. Ruskamp v. Hog Builders, Inc., 192 Neb. 168, 219 N.W.2d 750 (1974).

  • Where seller at time of contracting has reason to know particular purpose for which goods are required and that buyer is relying on seller's skill or judgment to select or furnish suitable goods there is, unless excluded or modified, an implied warranty that the goods shall be fit for such purpose. Larutan Corp. v. Magnolia Homes Manuf. Co., 190 Neb. 425, 209 N.W.2d 177 (1973).

  • Sewage processing plant constructed for sale to city's pollution control corporation by private company was subject to implied warranty of merchantability and of fitness for particular purpose for which it was to be used, and city could recover for breach. Omaha Pollution Control Corp. v. Carver-Greenfield Corp., 413 F.Supp. 1069 (D. Neb. 1976).

  • 4. Miscellaneous

  • The party formulating a contract will not be permitted to so fashion it as to mislead the other party by setting forth a clearly apparent promise or representation in order to induce acceptance and then designedly burying elsewhere in the document, in fine print, provisions which purport to limit or take away the promise or preclude recovery for the failure to fulfill it. Hillcrest Country Club v. N.D. Judds Co., 236 Neb. 233, 461 N.W.2d 55 (1990).

  • Instruction allowing jury to find an exclusion of implied warranty of fitness of bull for breeding by trade usage held proper. Torstenson v. Melcher, 195 Neb. 764, 241 N.W.2d 103 (1976).