Skip to content
97.5% of teams see value from GC AI before month oneSee how
Back To All Clauses

Warranty and Disclaimer of Warranties Clause

States what a party warrants about its goods or services and excludes implied warranties such as merchantability and fitness.

Reviewed by GC AI Solutions Team•Updated August 2026

Definition

A warranty and disclaimer clause does two jobs. The affirmative warranty promises that goods or services will meet a defined standard, such as conforming to specifications or being free from defects for a set period, and it pairs that promise with an exclusive remedy like repair, replacement, or refund. The disclaimer then excludes every other warranty, expressly naming the implied warranties of merchantability and fitness for a particular purpose that the UCC would otherwise supply. Disclaimers of implied warranties must be conspicuous, which is why they appear in capital letters. Together, the two parts fix exactly what the seller stands behind.

  • States the affirmative warranty, such as conformance to specifications or freedom from defects for a period
  • Sets the exclusive remedy for a warranty breach, often repair, replacement, or refund
  • Disclaims all other warranties, express or implied
  • Names and excludes the implied warranties of merchantability and fitness for a particular purpose
  • Uses conspicuous, capitalized text so the disclaimer is enforceable under the UCC

SaaS and software contracts increasingly replace a defect warranty with a material-conformance-to-documentation warranty tied to a service credit.

What It Does

The warranty section is a promise and a wall in one place. The affirmative warranty is what you can count on, and the disclaimer is everything the seller refuses to stand behind. For in-house counsel, it sets the line between covered and uncovered, and it controls your remedy when something fails. The operative questions are what standard the goods or services must meet, how long the warranty lasts and when it starts, whether the remedy is repair-only or reaches refund and cover, and whether the implied warranties are disclaimed conspicuously enough to hold. A practical test: if the only affirmative warranty is buried under an all-caps “as is” disclaimer, you are buying with all faults, whatever the marketing said.

When You'll See It

The warranty and disclaimer clause is standard in supply and manufacturing agreements, SaaS and software licenses, hardware sales, services contracts, and asset and stock purchase agreements. In goods contracts it pairs a limited defect warranty with a UCC disclaimer; in SaaS it leans on a conformance warranty and a service credit. It is most contested in supply and SaaS, where buyers push for a real performance warranty and sellers push the goods out as is.

It matters most where the product can fail in ways the buyer cannot inspect up front, such as a manufactured component or a software platform. The harder the quality is to verify, the more the warranty and its disclaimer decide who bears the loss.

Examples

UGI Utilities, Inc.

UGI Energy Services, LLC, Gas Supply and Delivery Service AgreementImplied-warranty disclaimer + title warrantyMutual2024
"11.2 Warranty Disclaimers. Except as expressly stated herein, neither Party provides any warranties to the other, express or implied, including implied warranties of merchantability and fitness for a particular purpose."
Source

Alcon Research, LLC

Lifecore Biomedical, LLC, Supply AgreementLimited warranty (defects + period)2023
"[…] (a) shall have been manufactured, packaged, labeled, held and shipped in accordance with the Ingredient Standards and (b) *will be free from defects in material and workmanship for a period of [\ \ \] from delivery to ALCON.**"
Source

B. Riley Brand Management LLC

BR Funding Holdings 2024-1 LLC, Transfer and Contribution AgreementAs-is + UCC implied-warranty disclaimer2024
"[…] (including any implied warranties that may otherwise be applicable because of the provisions of the UCC or any other applicable law, including the warranties of merchantability and fitness for a particular purpose)[…]"
Source

Paysign, Inc.

Daniel H. Spence, Stock Repurchase AgreementAs-is full disclaimer (no other reps)2023
"[…] AND SELLER EXPRESSLY DISCLAIMS ANY SUCH REPRESENTATION OR WARRANTY. ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE EXPRESSLY EXCLUDED."
Source

Negotiate

If you're the buyer:

You want a real warranty

  • Get an affirmative warranty that the goods or services conform to agreed specifications or documentation.
  • Resist an as-is sale and a blanket disclaimer of all express warranties.
  • Extend the warranty period and start it on acceptance, not shipment.
  • Add a remedy beyond repair-or-replace if repair fails, such as refund or cover.
  • Keep a pass-through of any manufacturer or third-party warranties.

If you're the seller:

You want to limit it

  • Disclaim all implied warranties conspicuously, naming merchantability and fitness.
  • Make repair, replacement, or refund the sole and exclusive remedy.
  • Limit the warranty period and tie it to delivery.
  • Exclude defects from misuse, modification, or use outside the documentation.
  • Sell as is where the deal economics justify it, with a clear written acknowledgment.

The warranty is the promise and the disclaimer is the wall. Know which one you are standing behind.

Red Flags

  • A disclaimer of implied warranties that is not conspicuous, which can fail under UCC 2-316.

  • An affirmative warranty with no exclusive remedy, leaving the seller exposed to open-ended claims.

  • An as-is sale slipped into a deal where the buyer expected a performance warranty.

  • A repair-or-replace remedy with no fallback if repair repeatedly fails.

  • A warranty period that runs from shipment, expiring before the buyer can test the goods.

Warranty and Disclaimer of Warranties Clause FAQs

What is a warranty disclaimer clause?
A provision that excludes warranties the law would otherwise imply, expressly naming the implied warranties of merchantability and fitness for a particular purpose.
What is the difference between a warranty and a representation?
A warranty is a promise that a fact or standard is or will be true, breach of which is a contract claim. A representation is a statement of fact that induces the contract. Many agreements address both in separate clauses.
Why are warranty disclaimers in all capital letters?
Because UCC 2-316 requires a disclaimer of implied warranties to be conspicuous. Capitalized or bold text is the common way to meet that standard.
What does as is mean in a contract?
It means the seller makes no warranties about quality or condition and the buyer takes the goods with all faults. An as-is sale generally excludes implied warranties when stated clearly.
Can you disclaim the implied warranty of merchantability?
Yes, when the disclaimer mentions merchantability and is conspicuous. Fitness-for-purpose disclaimers must be in writing and conspicuous as well.
What is the difference between a limited warranty and a full warranty?
A limited warranty restricts coverage, duration, or remedies. A full warranty, as defined by the Magnuson-Moss Warranty Act (15 U.S.C. §§ 2301–2312) for consumer products, meets minimum federal standards including free repair within a reasonable time.

Related Clauses

This content is for informational purposes only and does not constitute legal advice.