ORS 72.3140
Implied warranty: merchantability

  • usage of trade

(1)

Unless excluded or modified as provided in ORS 72.3160 (Exclusion or modification of warranties), 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. Under this section the serving for value of food or drink to be consumed either on the premises or elsewhere is a sale.

(2)

Goods to be merchantable must be at least such as:

(a)

Pass without objection in the trade under the contract description; and

(b)

In the case of fungible goods, are of fair average quality within the description; and

(c)

Are fit for the ordinary purposes for which such goods are used; and

(d)

Run, within the variations permitted by the agreement, of even kind, quality and quantity within each unit and among all units involved; and

(e)

Are adequately contained, packaged and labeled as the agreement may require; and

(f)

Conform to the promises or affirmations of fact made on the container or label if any.

(3)

Unless excluded or modified as provided in ORS 72.3160 (Exclusion or modification of warranties) other implied warranties may arise from course of dealing or usage of trade. [1961 c.726 §72.3140 (Implied warranty: merchantability)]

Source: Section 72.3140 — Implied warranty: merchantability; usage of trade, https://www.­oregonlegislature.­gov/bills_laws/ors/ors072.­html.

Notes of Decisions

A municipal corporation engaged in the business of supplying water to its inhabitants is engaged in an undertaking of a private nature and is generally liable therein for breach of contract or for negligence as a private corporation would be, but is not subject to an implied warranty of merchantability. Coast Laundry, Inc. v. Lincoln City, 9 Or App 521, 497 P2d 1224 (1972)

The seller was shown to have breached implied warranties of merchantability and fitness for a particular purpose. Valley Iron and Steel Co. v. Thorin, 278 Or 103, 562 P2d 1212 (1977)

In products liability action against manufacturer, where defective product was purchased from manufacturer’s distributor rather than from manufacturer itself, there was no “privity of contract” and thus implied warranty of merchantability was not applicable to transaction. Davis v. Homasote Company, 281 Or 383, 574 P2d 1116 (1978)

Evidence, inter alia, that buyer gave no specifications for electronic control unit, that buyer relied upon seller’s skill and judgment in its design and manufacture unit, and that buyer’s inspection did not reveal latent defects, was sufficient to establish existence of implied warranty of fitness for particular purpose. Controltek, Inc. v. Kwikee Enterprises, Inc., 284 Or 123, 585 P2d 670 (1978)

Reliance is not necessary element of implied warranty of merchantability. B.W. Feed v. General Equipment Co., 44 Or App 285, 605 P2d 1205 (1980)

Law Review Citations

11 WLJ 12, 21-35 (1974); 28 WLR 565 (1992)

72.1010
Short title
72.1020
Scope
72.1030
Definitions and index of definitions
72.1040
Definitions: “merchant”
72.1050
Definitions: “goods”
72.1060
Definitions: “contract”
72.1070
Goods to be severed from realty
72.2010
Formal requirements: statute of frauds
72.2020
Final written expression: parol or extrinsic evidence
72.2030
Seals inoperative
72.2040
Formation in general
72.2050
Firm offers
72.2060
Offer and acceptance in formation of contract
72.2070
Additional terms in acceptance or confirmation
72.2090
Modification, rescission and waiver
72.2100
Delegation of performance
72.3010
General obligations of parties
72.3020
Unconscionable contract or clause
72.3030
Allocation or division of risks
72.3040
Price payable in money, goods, realty or otherwise
72.3050
Open price term
72.3060
Output, requirements and exclusive dealings
72.3070
Delivery in single lot or several lots
72.3080
Absence of specified place for delivery
72.3090
Absence of specific time provisions
72.3100
Open time for payment or running of credit
72.3110
Options and cooperation respecting performance
72.3120
Warranty of title and against infringement
72.3130
Express warranties by affirmation, promise, description, sample
72.3140
Implied warranty: merchantability
72.3150
Implied warranty: fitness for particular purpose
72.3160
Exclusion or modification of warranties
72.3170
Cumulation and conflict of warranties express or implied
72.3180
Third party beneficiaries of warranties express or implied
72.3190
F.O.B. and F.A.S. terms
72.3200
C.I.F. and C. and F. terms
72.3210
C.I.F. or C. and F.: “net landed weights”
72.3220
Delivery “ex-ship.”
72.3230
Form of bill of lading required in overseas shipment
72.3240
“No arrival, no sale” term
72.3250
“Letter of credit” term
72.3260
Sale on approval and sale or return
72.3270
Special incidents of sale on approval and sale or return
72.3280
Sale by auction
72.4005
Definitions for ORS 72.4010 and 72.4030
72.4010
Passing of title
72.4020
Rights of seller’s creditors against sold goods
72.4030
Power to transfer
72.5010
Insurable interest in goods
72.5020
Buyer’s right to goods on seller’s repudiation, failure to deliver or insolvency
72.5030
Manner of seller’s tender of delivery
72.5040
Shipment by seller
72.5050
Seller’s shipment under reservation
72.5060
Rights of financing agency
72.5070
Effect of seller’s tender
72.5080
Cure by seller of improper tender or delivery
72.5090
Risk of loss in the absence of breach
72.5100
Effect of breach on risk of loss
72.5110
Tender of payment by buyer
72.5120
Payment by buyer before inspection
72.5130
Buyer’s right to inspection of goods
72.5140
When documents deliverable on acceptance
72.5150
Preserving evidence of goods in dispute
72.6010
Buyer’s rights on improper delivery
72.6020
Manner and effect of rightful rejection
72.6030
Merchant buyer’s duties as to rightfully rejected goods
72.6040
Buyer’s options as to salvage of rightfully rejected goods
72.6050
Waiver of buyer’s objections by failure to particularize
72.6060
What constitutes acceptance of goods
72.6070
Effect of acceptance
72.6080
Revocation of acceptance in whole or in part
72.6090
Right to adequate assurance of performance
72.6100
Anticipatory repudiation
72.6110
Retraction of anticipatory repudiation
72.6120
“Installment contract”
72.6130
Casualty to identified goods
72.6140
Substituted performance
72.6150
Excuse by failure of presupposed conditions
72.6160
Procedure on notice claiming excuse
72.7010
Remedies for breach of collateral contracts not impaired
72.7020
Seller’s remedies on discovery of buyer’s insolvency
72.7030
Seller’s remedies in general
72.7040
Seller’s right to identify goods to the contract notwithstanding breach or to salvage unfinished goods
72.7050
Seller’s stoppage of delivery in transit or otherwise
72.7060
Seller’s resale including contract for resale
72.7070
“Person in the position of a seller.”
72.7080
Seller’s damages for nonacceptance or repudiation
72.7090
Action for the price
72.7100
Seller’s incidental damages
72.7110
Buyer’s remedies in general
72.7120
“Cover”
72.7130
Buyer’s damages for nondelivery or repudiation
72.7140
Buyer’s damages for breach in regard to accepted goods
72.7150
Buyer’s incidental and consequential damages
72.7160
Buyer’s right to specific performance or replevin
72.7170
Deduction of damages from the price
72.7180
Liquidation or limitation of damages
72.7190
Contractual modification or limitation of remedy
72.7200
Effect of “cancellation” or “rescission” on claims for antecedent breach
72.7210
Remedies for fraud
72.7220
Who can sue third parties for injury to goods
72.7230
Proof of market price: time and place
72.7240
Admissibility of market quotations
72.7250
Statute of limitations in contracts for sale
72.8010
Definitions for ORS 72.8010 to 72.8200
72.8020
Manufacturer’s implied warranty of merchantability
72.8030
Manufacturer’s implied warranty of fitness
72.8040
Retailer’s or distributor’s implied warranty of fitness
72.8050
Disclaimer of implied warranty of merchantability or implied warranty of fitness
72.8060
Express warranty
72.8070
Right to make express warranty
72.8090
Form of express warranty
72.8100
Manufacturer’s service and repair
72.8110
Retailer’s service and repair of nonconforming good in absence of manufacturer’s service and repair facilities within state
72.8120
Time for commencement of service and repair
72.8130
Liability to retailer of manufacturer not maintaining service and repair facility within state
72.8140
Unauthorized or unreasonable use after sale
72.8150
Service contract in addition to or in lieu of express warranty
72.8160
Express warranty in addition to implied warranties
72.8170
Authority of manufacturer who makes express warranty to suggest methods of effectuating service and repair
72.8180
Buyer’s waiver of ORS 72.8010 to 72.8200
72.8190
Status of remedies under ORS 72.8010 to 72.8200
72.8200
Operative dates
Green check means up to date. Up to date