Any promise or description relating to goods sold, whether in a contract document, advertisement, letter, or other correspondence can create an express warranty that the goods conform to the promise or description. Careless or over-broad language, therefore, can give rise to unintended express warranties. Whether such language constitutes an express warranty is often a jury question which enhances a plaintiff's settlement leverage by avoiding defeat on summary judgment. Although few VARs made explicit Year 2000 warranties prior to 1996, many have warranted aspects of performance for an extended period or entered into maintenance agreements that span the millenium change that can be construed as warranting Year 2000 compliance. The U.C.C also recognizes implied warranties.
Implied warranties arise by operation of law rather than through seller statements or conduct.
Non-Year 2000 compliant hardware and software could be construed to contain a latent defect resulting in a breach of the implied warranty of merchantability. The implied warranty of fitness for a particular purpose arises where a seller knows the buyer's particular requirements and the buyer is relying on the sellers' skill in selecting suitable goods. This warranty is of particular concern to VARs and systems integrators, who design systems, integrate systems and select components. VARs should routinely disclaim both of these implied warranties in their standard contracts and maintenance agreements. VARs should conduct a legal audit and modify their standard contracts and long-term maintenance agreements prior to renewal.