Overview
This section prescribes the policies and procedures for using implied and express warranties in the acquisition of commercial products. It aligns government procurement practices with standard commercial law by emphasizing the use of customary commercial warranties while defining the government's rights regarding merchantability and fitness for a specific purpose.
Key Rules
- Implied Warranty of Merchantability: Establishes that items must be fit for ordinary purposes, be of at least average or medium-grade quality, and meet trade standards for items of that description.
- Implied Warranty of Fitness for Particular Purpose: Applies when the seller knows the government's specific intended use and the government relies on the contractor's expertise to provide an appropriate item.
- Legal Prerequisite: Contracting officers are required to consult with legal counsel before asserting any claim for a breach of an implied warranty.
- Mandatory Use of Commercial Warranties: Per 41 U.S.C. 3307, contracting officers must take advantage of commercial warranties and, to the maximum extent practicable, require terms at least as favorable as those offered to the general public.
- Express Warranty Analysis: Contracting officers must evaluate express warranties to ensure they are adequate for government needs, cost-effective, and provide clear administrative procedures for returns, repairs, and replacements.
- Limitation of Implied Warranties: While contractors may limit implied warranties if it is customary practice in their market, the express warranty must still provide for the repair or replacement of defective items within a reasonable time.
- Contractual Documentation: All express warranties must be formally included in the contract via an addendum to the standard commercial terms and conditions.
Practical Implications
- Contracting officers must actively research industry standards to ensure the government receives customary commercial warranty protections rather than relying solely on generic boilerplate language.
- When a government requirement is unique or highly specialized, the government should prioritize the "Fitness for Particular Purpose" protections but must ensure the contractor is fully aware of the specific application during the solicitation phase.