FIN 240 Lecture Notes - Lecture 22: Security Interest
Document Summary
Warranty - assurance or guarantee by the seller or lessor of certain facts concerning the goods being sold or leased. Ucc has numerous rules governing product warranties as they occur in sales and lease contracts. Articles 2 (sales) and 2a (leases) designate several types of warranties including warranties of title, express warranties, and implied warranties. Ucc can create three express warranties at sale: Good title - seller wants that they have good and valid title to the goods being sold and that they may rightfully transfer title to the buyer. Buyer can sue for breach if they later learn that the seller did not have valid title to the goods. No liens - protects buyers/lessees who are unaware of any liens. Liens - claims, charges, or liabilities against goods at the time the contract is made. Warranty protects buyers who unknowingly purchase goods that are subject to a creditor"s security interest.
