0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

when is a warranty also a representation?

24 April 2013

Where a seller of a business gives a ‘warranty’ that certain facts are true (e.g. that accounts are accurate), can the buyer bring a claim for misrepresentation if they’re not?

In a recent case the court found a problem with the word ‘warranty’ when bringing a claim for misrepresentation. The court felt the need to find ‘something more’ in order to turn the warranty into a representation (which would have allowed a claim above the liability cap).

Had the drafting been different (for instance stating that the seller ‘warrants and represents’) then the conclusion might also have been different.

So next time you’re offered a warranty that statements are true – why not also seek a representation, to give yourself a potential alternative claim (an example of a small drafting change that could make a real difference).

related opinions

IR35 changes - six months and counting...

In his 2018 Autumn Budget, the then Chancellor, Phillip Hammond, announced a significant change to the way liability for IR35 breaches will be dealt with for private sector companies from April 2020.

View blog

Supreme Court backs employers seeking to enforce restrictive covenants: Tillman v Egon Zehnder Ltd

The Supreme Court in Tillman v Egon Zehnder Ltd has determined that where post-termination restrictive covenants (i.e. “non-compete” clauses) in employment contracts go further than reasonably necessary to protect an employer’s business interests, it can apply the ‘blue pencil test,’ severing the offending words and leaving the remaining enforceable clause in place.

View blog

Discount rate remains negative

The much anticipated revision of the discount rate has arrived with the Lord Chancellor, David Gauke, announcing that it will be fixed at -0.25%.

View blog

Cyber risks – are businesses really ready?

The Hiscox Cyber Readiness report, a review of 3300 organisations, will be a stark warning for CEO’s of SME’s in the UK and in Europe.

View blog

mailing list sign up

Select which mailings you would like to receive from us.

Sign up