It’s Memorial Day Weekend, which means that Summer is right around the corner! As weather warms up, people tend to often make “Summer purchases” – boats, jet skis, beach houses, etc. However, when buying these objects from either a dealer or private individual, there are a number of legal rights and implications that few people are actually aware of.
For example, let’s say that you are purchasing a used fishing boat from another person (let’s call him “Bob”), not a boat dealer, in your state. Obviously, you are going to be concerned that once you take that boat out for its maiden voyage, the motor doesn’t start, there’s holes in the floor that were kept hidden from you, etc. and you realize that your $10,000 purchase is now sitting at the bottom of the lake. Now, you may want to go back to Bob and get your $10,000 back for the horrible purchase you just made because, as it turns out, you just purchased a “Lemon” boat from Bob.
Generally, most states have Lemon Laws that protect consumers from this exact type of situation. Lemon laws are designed to ensure that individuals and dealers are held responsible for selling malfunctioning or non-working vehicles to consumers. However, most Lemon Laws only protect consumers for vehicle purchases, such as a car, truck, or motorcycle, and only a few states protect consumers for purchases of boats and other watercraft.
So, when making one of these Summer purchases, what should you do to protect yourself and ensure that you have some sort of legal remedy against the seller? First and foremost, you should always have some sort of agreement, IN WRITING, that details the transaction at hand. Generally, when purchasing a watercraft from a dealer, you will have to sign multiple documents detailing the transaction. However, when dealing with a private person (say for instance, from eBay, Craigslist, etc.), you should have a Purchase Agreement and Bill of Sale in writing documenting the sale of the watercraft.
Next, you should be aware of certain “representations and warranties” that are to be included in the transaction. A representation is defined as an account or statement of facts, allegations, or arguments. Representations present everything from its past to its current status. In particular, Black’s Law Dictionary defines a representation as “A presentation of fact — either by words or by conduct — made to induce someone to act, especially to enter into a contract.”
A warranty generally moves from the present to the future. The watercraft that you are buying is warranted as being free of defects, and the company agrees to fix any defects for a specified amount of time into the future. Some products advertise that they have a lifetime warranty. For example, if you buy a new jet ski with a lifetime warranty, then every time it malfunctions, you can send it back to the company to be fixed. The warranty obligates the seller to the terms of the contract.
Warranties can be either expressed or implied. Expressed warranties mean they are written into the contract, and, for the most part, buyers should insist upon them. When dealing with either a dealer or private seller, you should insist that certain statements and facts be included as express warranties. This way, the seller must be held accountable for a breach of any express warranty, in addition to the current representations that the seller has made regarding the transaction. Legally within contracts, expressed warranties hold up better in a court of law than implied warranties.
Implied warranties fall under the Uniform Commercial Code (UCC), which in all sales of goods implies that there be a “fitness for a particular purpose.” That means that regardless of what the dealer or person says to you or what the contract says, these warranties are still included as part of the transaction. There are two types of implied warranties that would apply to your Summer purchase transaction” (1) Implied warranty of fitness for a particular purpose, and (2) Implied warranty of merchantability.
Under the UCC § 2-315, the implied warranty of fitness for a particular purpose is when “Where the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods, there is unless excluded or modified under the next section an implied warranty that the goods shall be fit for such purpose.” Thus, when purchasing a boat, if Bob is aware that you purchasing his boat for use on the lake, and you rely on his “expert skills” regarding the boat, you may be entitled to recovery of your $10,000 based on the implied warranty of fitness for a particular purpose.
An implied warranty of merchantability is an unwritten and unspoken guarantee to the buyer that goods purchased conform to ordinary standards of care and that they are of the same average grade, quality, and value as similar goods sold under similar circumstances. In other words, merchantable goods are goods fit for the ordinary purposes for which they are to be used. The UCC provides that courts may imply a Warranty of merchantability when (1) the seller is the merchant of such goods, and (2) the buyer uses the goods for the ordinary purposes for which such goods are sold (§ 2-314). Thus, a buyer of a boat can sue a seller for breaching the implied warranty by selling a boat that is unfit for its ordinary purpose, i.e. floating on a lake.
In conclusion, you should be aware of the major legal consequences of purchasing specific objects, such as boats, jet-skis, cars, etc. Make sure that whenever you are making such a purchase, you have a written document that includes the specifics of the transaction, as well as the specific representations and warranties that have been made regarding the purchase. Because without being aware of your legal rights and remedies of a “Summer purchase,” you may just be spending Memorial Day Weekend watching your boat sink to bottom of a lake and wishing that you had never met Bob.