Brief Fact Summary.
Hunt sued Perkins Machinery Company (Perkins) after purchasing a faulty tractor engine that could not be repaired and Perkins disclaimed all warranties.
Synopsis of Rule of Law.
Under the Uniform Commercial Code, a disclaimer is not conspicuous if a reasonably person would not have noticed it.
Hunt bought a Caterpillar tractor engine from Perkins Machinery Company (Perkins) that disclaimed all warranties, including warranty of merchantability and warranty of fitness of particular purpose, listed within 11 paragraphs under a bold-faced “TERMS AND CONDITIONS.” The tractor engine emitted black smoke and Hunt was unable to repair the defect on several occasions, Hunt also never read the terms and conditions. Hunt sued Perkins for breach of the implied warranty of merchantability and implied warranty of fitness for particular purpose. The trial court granted judgment to Hunt and Perkins appealed.
Whether a disclaimer is conspicuous if a reasonable person would not have noticed it?
No. The judgment of the trial court is affirmed. Although a reasonable person would have noticed bold-faced, capital letters, the back of the purchase order was attached to the notepad. Similarly, although “TERMS AND CONDITIONS” were listed on the front of the purchase order, the purchase order did not indicate that the actual terms and conditions were on the reverse side of the purchase order. The disclaimers were not conspicuous because the terms and conditions on the front of the purchase order did not reference the disclaimers on the back of the purchase order.
Section 2-316(2) of the Uniform Commercial Code (UCC) requires a writing that specifically references the implied warranty of merchantability and the implied warranty of fitness for particular purpose in order for both to be excluded. § 1-201(10) of the UCC renders a term conspicuous if a reasonable person would have noticed it.