Opinion ID: 2616171
Heading Depth: 1
Heading Rank: 6

Heading: disclaimer of warranty

Text: The majority argues that even if an implied warranty applies, it was disclaimed by inspection and contract. The first argument can be disposed of summarily. Although the Frickels did inspect the manager's apartment and one or two others, the trial court found the structural defects could not have been detected on the site by anyone, not even an expert. In Tyus v. Resta, 328 Pa. Super. 11, 476 A.2d 427 (1984), the court stated: A reasonable pre-purchase inspection requires examination of the premises by the intended purchaser  not by an expert. Defects which would not be apparent to an ordinary purchaser as a result of a reasonable inspection constitute latent defects covered by the implied warranties. Tyus, at 22. In the context of a commercial investment in residential property, I would not hold that an implied warranty cannot be disclaimed by expert inspection; commercial investors should be expected to seek expert advice. However, where even an expert would be unable to detect a latent defect, a purchaser's cursory inspection cannot serve to disclaim an implied warranty. The more important question in this case, however, is whether an implied warranty can be disclaimed by contract. The majority attempts to elevate the following contract language to the level of a disclaimer: The purchaser agrees that full inspection of said real estate has been made and that neither the seller nor his assigns shall be held to any covenant respecting the condition of any improvements thereon nor shall the purchaser or seller or the assigns of either be held to any covenant or agreement for alterations, improvements or repairs unless the covenant or agreement relied on is contained herein or is in writing and attached to and made a part of the contract. Majority opinion, at 716. As yet, Washington courts have not determined the validity of disclaimers of the implied warranty of habitability. In the landlord-tenant area, this court held that such disclaimers contravene public policy. Foisy v. Wyman, 83 Wn.2d 22, 28, 515 P.2d 160 (1973). Arguably, the result should be the same in the new house context. Nevertheless, courts have validated such disclaimers if the language clearly and unambiguously demonstrates the intention of both parties to disclaim the implied warranty. See Conyers v. Molloy, 50 Ill. App.3d 17, 22, 364 N.E.2d 986 (1977). In my opinion, disclaimer of an implied warranty under the facts of this case does not contravene public policy. Unlike the purchaser of a new house, the Frickels purchased the dwelling for purposes of investment. If they desired to disclaim the warranty, the law should not prevent them from doing so, even if their disclaimer insulates a shoddy contractor from liability. The question remains, however, whether the Frickels did disclaim the implied warranty by signing a contract containing the above quoted language. Reasoning by analogy to Washington's commercial code, I believe a valid disclaimer of the implied warranty of a residential structure should be written, conspicuous, and include the term habitability. See RCW 62A.2-316(2). Furthermore, the disclaimer should be explicitly negotiated. See Berg v. Stromme, 79 Wn.2d 184, 484 P.2d 380 (1971); Testo v. Russ Dunmire Oldsmobile, Inc., 16 Wn. App. 39, 554 P.2d 349, 83 A.L.R.3d 680 (1976). In an ordinary sale of goods, the requirements of conspicuousness and express reference to merchantability under RCW 62A.2-316(2) are not mandatory. RCW 62A.2-316(3). Subsection (3) states that [n]otwithstanding subsection (2), the implied warranty can be disclaimed by language which clearly excludes any implied warranty. However, given the nature of the transaction in this case  sale of an expensive residential complex  the requirements of subsection (2) should prevail over subsection (3). 54 Wash. L. Rev. at 215 n. 153. In MacDonald v. Mobley, 555 S.W.2d 916 (Tex. Civ. App. 1977) involving the disclaimer of a new house warranty, the court relied on the Texas equivalent of subsection (2), invalidating the disclaimer because it was not conspicuous. MacDonald, at 919. In my opinion, this court should adopt the same rule with respect to the disclaimer of implied warranties in the context of sales of residential property. Even assuming the contract language relied upon by Sunnyside evinces an intent to disclaim implied warranties, this language does not include the term habitability and was not explicitly negotiated. The pertinent phrase simply stated that Sunnyside shall [not] be held to any covenant respecting the condition of any improvements on the real estate. Furthermore, the record clearly shows the parties neither discussed nor negotiated this term. Mr. Frickel testified that he was totally unfamiliar with a warranty clause. Accordingly, assuming the court applies the implied warranty of habitability to this transaction, the facts do not support the majority's contention that the Frickels waived all warranties. In sum, I would hold the implied warranty of habitability in the sale of residential real property can be disclaimed only where the property is acquired for investment purposes, and the disclaimer (a) is explicitly negotiated, (b) is written and conspicuous, and (c) includes the term habitability. In my opinion, these requirements were not met in this case, and accordingly I would affirm the decision of the trial court. DORE and CALLOW, JJ., concur with PEARSON, J. Reconsideration denied December 8, 1986.