California’s Commercial Code — which adopts the Uniform Commercial Code — provides for two types of implied warranties that apply to vehicle sales. The implied warranty of merchantability, under Commercial Code Section 2314, means that the vehicle is fit for the ordinary purpose for which vehicles are used — namely, safe and reliable transportation. A vehicle that can’t be driven safely on public roads, or that has defects so severe that it can’t perform its basic function, fails the merchantability standard.
The implied warranty of fitness for a particular purpose, under Commercial Code Section 2315, arises when the buyer tells you they need a vehicle for a specific purpose, you know about that purpose, and the buyer relies on your expertise to select an appropriate vehicle. For example, if a buyer says “I need a truck that can tow a 7,000-pound trailer” and you sell them a truck with a 5,000-pound tow rating, the vehicle may fail the implied warranty of fitness for the buyer’s particular purpose.
Under California law, implied warranties can be disclaimed in “As-Is” sales — but the disclaimer must be clear, conspicuous, and properly documented on the Buyers Guide and in the sales contract. Even with a valid “As-Is” disclaimer, remember that Civil Code Section 1795.5 may still provide implied warranty protection for used vehicles sold with any express warranty, regardless of an “As-Is” designation.