Here’s a thing that probably appears in your standard terms and conditions: “This agreement cannot be modified or rescinded, except in writing signed by an authorized agent of [your company].” You can go ahead and check. It’s probably down toward the bottom, above the miscellaneous provisions like choice of law.
Uniform Commercial Code
An easily-overlooked portion of a contract for the sale of goods is the one that addresses what notice the buyer must give the seller in the event the goods do not conform to contract specifications or warranties. These provisions warrant your close attention, however, because they can be outcome-determinative in the event of litigation over the alleged non-conformity.
Now that we have completed our brief detour into what the Supreme Court could maybe do with the BP oil spill case if it decides to do anything with it, we resume our ongoing series on what law applies when you incorporate software into your products.
In the first installment of this series, we discussed the general scope of Article 2 of the Uniform Commercial Code, and, in the broadest terms, whether and when the purchase or sale of software falls within that scope. In this installment, we’ll move toward our goal of understanding when your purchase or sale of software is governed by Article 2 by looking at how the question has been treated by various courts over time.
This column spends a lot of time talking about Article 2 of the Uniform Commercial Code. A lot of time. That’s because it’s a column directed to manufacturers, and Article 2, generally speaking, deals with sales of goods.But that “generally speaking” glosses over quite a bit, and it can cause us to miss important issues.
The North Carolina Supreme Court recently analyzed whether a loan officer owes a borrower a fiduciary duty in a home mortgage transaction. Dallaire v. Bank of Am., ___N.C.___, 747 S.E.2d 535 (2013), decided June 12, 2014, No. 51PA13. Jacques and Fernande Dallaire (“Borrowers”) purchased a home as their primary residence in 1998. Seven years later they filed Chapter 7 bankruptcy due to unrelated business debts.
Remember when I wrote a glowing column about a Master Development and Supply Agreement Apple and its lawyers drafted? It was one of the most-read posts I’ve written, so I bet a good number of you do. Since the post was so popular, and since there have been some, well, we’ll say “unanticipated consequences” for Apple, I thought it warranted some follow up.
This post comes to you based on a story by the always-excellent Matt Levine of BloombergView. Evidently Apple loaned a company called GT Advanced Technologies a bunch of money so GTAT could develop and supply Apple with sapphire screens for a long time. Anyway, there may have been a default under part of that agreement, and GTAT filed for bankruptcy protection because that default was going to ruin everything (at least according to industry speculation).
A thing I like to do is approach people at parties and other gatherings and ask them if they know they can use contracts to shorten some statutes of limitations. Usually I get quizzical looks, but I guess the context just worked better when I mentioned it while speaking at a recent event put on by the Kansas Bar Association. An especially attentive participant asked a good follow-up question that warrants some discussion: can you shorten the limitations period for fraud?
In the first four installments of this series, we covered the essential components of an effective limited warranty. But each of those installments carried an important caveat: that you were not selling consumer goods. In this fifth and final installment of the series, we turn our attention to additional warranty issues to consider when selling consumer goods.