Contracts and Sales Multistate Bar Practice Exam

Which of the following is a way for a seller to disclaim the implied warranty of merchantability?

1. By providing a verbal assurance of quality

2. By stating "as is" in writing

3. By offering a discount

4. By guaranteeing satisfaction

The correct answer is: By stating "as is" in writing

A seller can effectively disclaim the implied warranty of merchantability by stating "as is" in writing. The implied warranty of merchantability is a legal concept that assures buyers that the goods being sold are fit for their ordinary purpose and meet a standard of quality. However, this warranty can be disclaimed if the seller provides clear and conspicuous language to the buyer at the time of the sale. When a seller uses "as is," it indicates that the buyer accepts the product in its current condition, and the seller is not providing any guarantees regarding the quality or suitability of the goods. The phrasing must typically be included in the sales contract or other written documentation to be valid. Other methods, such as offering a verbal assurance of quality or stating a guarantee of satisfaction, do not effectively disclaim the warranty because they often imply that the seller is still standing behind the quality of the goods. A discount may also not serve as a proper disclaimer, as it does not communicate an absence of warranty but rather could suggest a negotiation on price while still maintaining the warranty's existence.