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    Implied Warranties

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    While browsing through a used car lot, Ortega was approached by a fast-talking salesperson who said, 'I've got a beauty that just came in. Take a look at that baby," pointing to a shiny, red Mustang. "It's a jewel, and I can let it go at a good price. You won't find a better car for the money anywhere."
    "What'll it get for mileage?" Ortega asked.
    'I guarantee you'll get 35 miles per gallon driving in the city with that beauty," the salesperson quickly replied.
    Ortega bought the Mustang and discovered, after a few weeks, that the car's mileage averaged 19 miles per gallon in city driving instead of the 35 miles the salesperson had guaranteed.
    Four months later, Ortega returned to the used car lot and reminded the salesperson of the guarantee. The salesperson responded, "Oh, we don't make guarantees. Take a look at your sales slip." Ortega then saw that the salesperson had written the words "as is" on the sales slip.

    Opening Case Questions
    1. Are the comments, "It's a jewel," and "You won't find a better car for the money anywhere," considered warranties?
    2. Is the salesperson's oral guarantee of 35 miles per gallon a warranty?
    3. Do the words "as is" written on the sales slip assist the dealer in this case?
    4. Can Ortega win a lawsuit against the dealer for damages?

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    Solution Preview

    In this case, the comments," It's a jewel", and "you won't find a better car for the money anywhere", constitute verbal warranties, due to the fact that the statements describe to the buyer some truths or facts about the automobile. The sales ...

    Solution Summary

    The implied warranties for Ortega approaches are given.