Warranty
A promise that a product or service meets certain standards or characteristics. Express warranties are stated in the contract; implied warranties arise automatically by law.
While straightforward in theory, many businesses fail to actively track obligations tied to this concept - often resulting in missed deadlines, unintended renewals, penalties, or loss of contractual rights.
US Law · For business owners and foundersWhat is a Warranty?
A warranty is a promise or guarantee that a product, service, or other contract subject matter meets certain standards. If the warranty turns out to be false, the warranting party has breached the contract and the other party can seek a remedy.
Express warranties are explicitly stated - in a contract, a sales document, an advertisement, or even a verbal statement made during a sale. If a software vendor says "this platform is SOC 2 certified," that statement can become an express warranty even if the written agreement says nothing about it.
Implied warranties arise automatically under law, without any agreement by the parties. The most important ones come from the Uniform Commercial Code (UCC) for the sale of goods: the implied warranty of merchantability (goods are fit for ordinary purposes) and the implied warranty of fitness for a particular purpose (goods are suitable for the buyer's specific stated need). Implied warranties can generally be disclaimed in writing with proper language.
In practice, many teams rely on a contract expiry tracking system to stay on top of dates and obligations tied to clauses like this.
Key Elements
Express warranty
Any affirmation of fact, promise, or description that becomes part of the basis of the bargain. Statements of opinion ("this is a great product") generally do not create express warranties.Implied warranty of merchantability
Applies automatically to merchants selling goods under the UCC. Goods must be fit for the ordinary purposes for which they are used, properly packaged and labeled.Implied warranty of fitness for a particular purpose
Arises when a seller knows the buyer's specific purpose and the buyer relies on the seller's judgment to select suitable goods.Disclaimer
Implied warranties can be disclaimed with conspicuous language using the word "merchantability" for the UCC implied warranty. "AS IS" language also generally excludes implied warranties.Real-World Example
A SaaS company's contract states: "Service shall be available 99.9% of the time measured monthly." The platform experiences 6 hours of downtime in one month - far exceeding the 0.1% (about 43 minutes) permitted.
The uptime commitment is an express warranty. The 6-hour outage breaches it. Depending on the SLA remedy provisions, the customer may be entitled to service credits, termination rights, or damages - and the company is exposed for the warranty breach.
This is why many businesses adopt automated deadline tracking to ensure no critical dates are missed before they pass.
Sample Clause Language
Express warranty and disclaimer clauseWatch Out For
Marketing statements as warranties
Claims in brochures, websites, demos, and sales pitches can become express warranties even if the signed contract has a disclaimer. Train your sales team on what they say.Insufficient disclaimer language
Under the UCC, a disclaimer of the implied warranty of merchantability must specifically use the word "merchantability" and be conspicuous (often in caps or bold). Generic "as is" language may not always suffice.Warranty scope creep in SaaS
Uptime commitments, data security representations, and compliance certifications all function as warranties. Breach of any of them can trigger liability beyond your intended scope.Don't let warranty deadlines catch you off guard
Key dates tied to warrantys - renewal windows, expiry cutoffs, notice periods - can easily slip through the cracks when tracked manually. Missing them triggers automatic extensions, penalties, or lost rights. ExpiryEdge tracks every critical deadline and sends automated reminders before they're due - so nothing slips.
Instead of relying on spreadsheets or manual follow-ups, a centralized renewal reminder system ensures every deadline is visible, tracked, and actioned automatically.
How to Use This in Your Favor
Limit warranty scope explicitly
State exactly what you are warranting (specific functionality, uptime threshold, material compliance with documentation) and disclaim everything else. Specificity protects you from implied extensions.Define the exclusive remedy
When a warranty is breached, specify the remedy: service credits, re-performance, or refund. Include language stating this is the exclusive remedy for warranty breach to limit additional damages exposure.Cap warranty liability
Pair your warranty clause with your limitation of liability clause. Make clear that warranty breach claims are subject to the overall liability cap.Related Terms
Frequently Asked Questions
What is the difference between a warranty and a representation?
A representation is a statement of present fact that induces you to enter a contract. A warranty is a promise about future performance or ongoing condition. Breach of a representation may give rise to a misrepresentation claim; breach of a warranty is a contract claim.
Can I disclaim all warranties in a B2B software contract?
Generally yes for implied warranties, if the disclaimer is conspicuous and uses the required language. You cannot disclaim express warranties you explicitly made. Courts may also scrutinize broad disclaimers in consumer-facing contracts.
How long does a warranty last?
As long as you specify. Express warranty periods are defined by the contract (e.g., "12 months from delivery"). Implied warranties under the UCC are tied to the UCC statute of limitations - typically 4 years from delivery for goods.