Must I pay for defective product made pursuant to a supplier contract?
Full Question:
Answer:
The first area to examine is the language of any contract that exists between the parties. If the contract required the manufacturer to produce a viable, effective product, then the other party may have a claim for breach of contract when the product does not meet the contract expectations. Failure to fulfill the bargain of the contract would prevent the manufacturer from being entitled to the compensation provided by the contract.
A breach of warranty involves a broken promise about a product made by either a manufacturer or a seller. The term also covers a failure of a statement or agreement by a seller of property which is a part of the contract of sale, when the truth of the statement is necessary to the validity of the contract. Warranties are also express or implied. An express warranty is a particular stipulation introduced into the written contract, by the agreement of the parties; an implied warranty is a guarantee imposed by law in a sale. Even though the seller may not make any explicit promises, the buyer still gets some protection.
Warranty protection is provided under the Uniform Commercial Code (UCC), which has been adopted, at least in part, by all states. On the federal level, Congress enacted the Magnuson-Moss Warranty—Federal Trade Commission Improvement Act of 1975, The federal Act has had a substantial impact on the warranty provisions of the Uniform Commercial Code. In general, it mandates certain guidelines in connection with written warranties and, where written warranties are given, invalidates attempts to disclaim implied warranties. The federal Act is aimed at written warranties and service contracts made in connection with the sale of "consumer products," requires that they they must meet federal standards in terms of disclosure and remedies provided to an aggrieved consumer.
Breach of contract means failing to perform any term of a contract without a legitimate legal excuse. The contract may be either written or oral. A breach may include not finishing a job, failure to make payment in full or on time, failure to deliver all the goods, substituting inferior or significantly different goods, not insuring goods, among others. An anticipatory breach made be made by an act which indicates the party will not complete the work.
A breach of contract in legal terms amounts to a broken promise to do or not do an act. Breaches of a contract are single, occuring at a single point in time, or continuing breaches. A lawsuit for breach of contract is a civil action and the remedies awarded are designed to place the injured party in the position they would be in if not for the breach. Remedies for contractual breaches are not designed to punish the breaching party. A contract a a legally enforceable promise, either made in writing or orally. However, certain promises must be reduced to writing in order to satisfy the Statute of Frauds, a rule of substantive law, not a rule of evidence, that specifies certain subjects that must be evidenced by a written instrument.
The non-breaching party is relieved of his obligations under the contract by the other party's breach. Courts will award damages in the event of a breach, but the intent is not to punish the breaching party, but rather to put the other party in the position they would occupy if the contract had been fulfilled. In cases where money is inadequate to compensate the aggrieved party, the court may award specific performance to force the breaching party to fulfill the terms of the contract.
It would be wise to formally notify the manufacturer of the belief that the product is defective and that the bill is disputed on that ground.