9.5 Warranties

• Library: Virginia Construction Law Deskbook (Virginia CLE) (2019 Ed.)

9.5 WARRANTIES

9.501 Express Warranties. Express warranties are those explicitly set forth either orally or in writing. For example, a contract may provide an express warranty of workmanship in which the contractor warrants that the materials and equipment will be of good quality and new, that the work will be free from defects, and that the work will conform to the requirements of the contract. Many contracts also provide for a one-year correction warranty (for example, the contractor "shall remedy any defects due to faulty materials or workmanship and pay for any damage to other work resulting therefrom, which shall appear within a period of one year"). ⁷⁷ Contractors often intend correction warranties to limit their entire liability to one year, but most courts have held that such one-year correction warranties do not exclude or limit other warranties. ⁷⁸

Many warranties arise from the Uniform Commercial Code—Sales. ⁷⁹ However, those warranties apply only to contracts for the sale of goods. They

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may apply to construction contracts where the contract involves the sale of goods, but they may be inapplicable if the contract also involves the provision of services. Whether the UCC applies generally depends on whether the provision of goods or the provision of services is the predominant purpose of the contract. ⁸⁰

With regard to the sale of goods, it is not necessary that an express warranty include the term "warrant" or "guarantee." ⁸¹ Instead, an express warranty regarding goods may be created by:

1.	Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain . . . ;
2.	Any description of the goods which is made part of the basis of the bargain . . . ; or
3.	Any sample or model which is made part of the basis of the bargain . . . . 82

9.502 Common Law Implied Warranties. Implied warranties are warranties not set forth in the contract but implied by law. For example, in every construction contract there is an implied warranty of workmanlike construction. "[T]he law presumes that the work shall be done in a work-manlike manner and in accordance with good usage and accepted practices in the community in which the work is done." ⁸³ A construction contract also implies a duty to the purchaser of a residential dwelling that the home will be habitable. ⁸⁴ "[A] builder-vendor impliedly warrants to the initial purchaser that a house and all its fixtures will provide the service or protection for

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which it was intended under normal use and conditions." ⁸⁵ A claim based on implied warranty requires (i) proof of the existence of the warranty, (ii) breach of the warranty, and (iii) injury to the plaintiff as the proximate result of the breach. ⁸⁶ The measure of damages for such claims is usually the cost of remedying the breach. ⁸⁷

9.503 Statutory Implied Warranties on New Construction. Section 55.1-357 of the Virginia Code provides an implied warranty on new construction. This statute provides that in every contract for the sale of a new dwelling the seller will be held to an implied warranty that the dwelling is "sufficiently (i) free from structural defects, so as to pass without objection in the trade, and (ii) constructed in a workmanlike manner, so as to pass without objection in the trade." ⁸⁸ In addition, if the seller is in the business of building or selling new dwellings, the contract is deemed to include an implied warranty that the dwelling is fit for habitation. ⁸⁹ These warranties are "in addition to, and not in lieu of, any other express or implied warranties pertaining to the dwelling, its materials or fixtures." ⁹⁰

9.504 UCC Implied Warranty of Fitness for a Particular Purpose. The implied warranty of fitness for a particular purpose is established by section 8.2-315 of the Virginia Code:

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 [§ 8.2-316] an implied warranty that the goods shall be fit for such purpose.

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A claim based on implied warranty under the statute requires proof that:

1.	The seller had reason to know the particular purpose for which the buyer required the goods;
2.	The seller had reason to know the buyer was relying on the seller's skill or judgment to furnish appropriate goods;
3.	The buyer in fact relied upon the seller's skill or judgment; 91 and
4.	The buyer gave timely notice of the breach. 92

The measure of damages under the Uniform Commercial Code is the "difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount." ⁹³

9.505 UCC Implied Warranty of Merchantability. Like the implied warranty of fitness for a particular purpose, the implied warranty of merchantability is established by statute. Section 8.2-314 provides that "a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind." "Merchantable" goods are defined under this section as goods that:

1.	Pass without objection in the trade under the contract description; and
2.	In the case of fungible goods, are of fair average quality within the description; and

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3. Are fit for the ordinary purposes for which such

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