December 23, 2011 at 17:54How to properly exclude implied warranties in a software development contract (Part 3)
If you remember, in the first part of his article safeguards I mentioned the "implied guarantees» ( Implied Warranties ), which are automatically part of the contract for software development, as they are fixed by law. In British law, these guarantees are enshrined in The Sale of Goods Act 1979 and The Supply of Goods and Services Act 1982 . Let me remind you that the “Implied Warranties” include: 1) Warranty of Title, 2) Infringement Warranty, 3) Warranty of Merchantability, 4) Warranty of fitness for a specific Purpose.We talked about the fact that if the validity of these guarantees is not directly excluded, then they will apply to legal relations under this contract. I now propose to consider options for excluding these implied warranties.
First of all, it is worth noting that if we are talking about the law of the United Kingdom, then all warranties exceptions must comply with the requirements of UTCA (Unfair Contract Terms Act 1977) . According to UTCA, some “implied warranties” cannot be excluded at all (for example, “Warranty of Title” ), and some can be excluded only when appropriate - “only if reasonable” (for example, “Warranty of fitness for a specific Purpose” ") If the court concludes that the condition for exclusion of the guarantee is contrary to the requirements of this normative act, then this condition will be considered invalid. To avoid the risks associated with UTCA violation, and in order to ensure that the maximum number of warranty obligations is excluded, the developer can use the following construction: "Other warranties are excluded to the maximum extent permitted by law . "
1. "EXCEPT FOR THE EXPRESS WARRANTIES SPECIFIED IN THIS SECTION, PROVIDER MAKES NO WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR using the warp clause
exceptionally This is an established contract practice in the USA and Great Britain.
2. «RECIPIENT ACCEPTS THE GOODS" AS IS, "WITH NO WARRANTY OR REPRESENTATION OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE»
Disclaimer « AS IS » turnover means the goods are transferred to the property “as is”, i.e. without any warranty.
3."Provider does not warrant that the Product will perform without error or that it will run without immaterial interruption. Provider provides no warranty regarding, and will have no responsibility for, any claim arising out of: (a) a modification made by Recipient, unless Provider approves such modification in writing; or (b) use of the Product in combination with or on products other than as specified in the Technical Specifications or authorized in writing by Provider ”
This example shows that it is impractical to ensure that the software developed is an error-free product. Defects are different and, in my opinion, to promise the customer that the software is free from material defects (" material defects ") is quite enough.
Naturally, in the contract or in the Statement of Work it is necessary to reflect what is recognized as a significant defect. The classification of defects “blocker-major -minor” and the exact definition of “ Acceptance Criteria ” will be sufficient to address this issue.
4. “Provider: (a) will pass through to Recipient any warranty right it receives from any third party provider of System components not authored or manufactured by Provider (“ Third Party Components ”); and (b) will reasonably cooperate with Recipient in enforcing such rights. Provider provides no warranties, express or implied, with regard to Third Party Components, and Provider will not be liable for any failure of any Third Party Component to function as expected or intended »
In this example, the developer is not responsible for the risks associated with the functioning problems of components that belong to a third party.
5. "Provider does not warrant the Software's interoperability with any computer operating system other than the versions of Windows XP issued by Microsoft Corporation as of the Effective Date"
Here, the customer does not guarantee interoperability with non-Windows XP operating systems.
1) The developer must clearly determine his position regarding those guarantees that he can give to the customer. The exclusion of all guarantees is the least risky approach, but the customer is unlikely to agree to pay for a product whose acceptable functioning is not supported by any legal means.
2) At the same time, you should not use the whole range of possible guarantees. Sufficiently appropriate and necessary warranties that are suitable for your particular case and will give your counterparty confidence in warranty safety.
Links to other parts of the article:
1) Guarantee of software operability in the English contract (Part 1)
habrahabr.ru/blogs/pm/134007
2) Guarantee of the observance of the rights of third parties in the English contract for software development (Part 2)habrahabr.ru/blogs/pm/134476
First of all, it is worth noting that if we are talking about the law of the United Kingdom, then all warranties exceptions must comply with the requirements of UTCA (Unfair Contract Terms Act 1977) . According to UTCA, some “implied warranties” cannot be excluded at all (for example, “Warranty of Title” ), and some can be excluded only when appropriate - “only if reasonable” (for example, “Warranty of fitness for a specific Purpose” ") If the court concludes that the condition for exclusion of the guarantee is contrary to the requirements of this normative act, then this condition will be considered invalid. To avoid the risks associated with UTCA violation, and in order to ensure that the maximum number of warranty obligations is excluded, the developer can use the following construction: "Other warranties are excluded to the maximum extent permitted by law . "
Examples of “warranties” exclusion clauses:
1. "EXCEPT FOR THE EXPRESS WARRANTIES SPECIFIED IN THIS SECTION, PROVIDER MAKES NO WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR using the warp clause
exceptionally This is an established contract practice in the USA and Great Britain.
2. «RECIPIENT ACCEPTS THE GOODS" AS IS, "WITH NO WARRANTY OR REPRESENTATION OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE»
Disclaimer « AS IS » turnover means the goods are transferred to the property “as is”, i.e. without any warranty.
3."Provider does not warrant that the Product will perform without error or that it will run without immaterial interruption. Provider provides no warranty regarding, and will have no responsibility for, any claim arising out of: (a) a modification made by Recipient, unless Provider approves such modification in writing; or (b) use of the Product in combination with or on products other than as specified in the Technical Specifications or authorized in writing by Provider ”
This example shows that it is impractical to ensure that the software developed is an error-free product. Defects are different and, in my opinion, to promise the customer that the software is free from material defects (" material defects ") is quite enough.
Naturally, in the contract or in the Statement of Work it is necessary to reflect what is recognized as a significant defect. The classification of defects “blocker-major -minor” and the exact definition of “ Acceptance Criteria ” will be sufficient to address this issue.
4. “Provider: (a) will pass through to Recipient any warranty right it receives from any third party provider of System components not authored or manufactured by Provider (“ Third Party Components ”); and (b) will reasonably cooperate with Recipient in enforcing such rights. Provider provides no warranties, express or implied, with regard to Third Party Components, and Provider will not be liable for any failure of any Third Party Component to function as expected or intended »
In this example, the developer is not responsible for the risks associated with the functioning problems of components that belong to a third party.
5. "Provider does not warrant the Software's interoperability with any computer operating system other than the versions of Windows XP issued by Microsoft Corporation as of the Effective Date"
Here, the customer does not guarantee interoperability with non-Windows XP operating systems.
CONCLUSIONS:
1) The developer must clearly determine his position regarding those guarantees that he can give to the customer. The exclusion of all guarantees is the least risky approach, but the customer is unlikely to agree to pay for a product whose acceptable functioning is not supported by any legal means.
2) At the same time, you should not use the whole range of possible guarantees. Sufficiently appropriate and necessary warranties that are suitable for your particular case and will give your counterparty confidence in warranty safety.
Links to other parts of the article:
1) Guarantee of software operability in the English contract (Part 1)
habrahabr.ru/blogs/pm/134007
2) Guarantee of the observance of the rights of third parties in the English contract for software development (Part 2)habrahabr.ru/blogs/pm/134476