This contract tip is about defining the word “defect” in your agreements.
Most purchase contracts have a product warranty that says the goods will be free from defects in workmanship and materials. But that leads us to ask what we mean by the word defect.
Two people could define defect differently.
I'd go as far as to say that the vendor and customer in most cases WILL define it differently if the contract is not clear. Is it a defect if the product has a huge scratch? Or becomes very loud?
I prefer to be specific about what issues rise to the level of a defect.
Here are some options to consider for your defect definition:
Defect means a condition or issue with a part, component, material in the Product that:
- causes the Product not to strictly conform with X [list other quality warranties such as conform to Specifications},
- impairs the intended use of the Product,
- causes an objectionable issue with the Product, such as sound levels or overheating,
- the Buyer believes causes a potential safety hazard that could result in personal injury or negative health consequences, or
- results in non-structural surface imperfections [that impair any intended functionality of the Product].
What approach to defining the word defect do you prefer? Why?
