Consumer warranties under Texas law
Consumer products and services often come with warranties backing up the quality of what the consumer bought. When the product or service falls short the warranty should make up the difference. What happens when the company won't honor its warranty?
IntroCompanies in Bedford, Fort Worth and Dallas like to sell warranties to customers because they are a great source of income. They are a cash cow because the number of claims against the warranties are often low. Claims may even be covered by manufacturer warranties. Sometimes companies double dip against warranties by selling you one and then not covering claims. This may happen with a product or service in which the warranty was part of the normal sales price as an incentive to trust the service provider.
It can be incredibly frustrating when you need the warranty and the business won't honor it. Texas consumer laws provide remedies to help you recover from the company. Best of all, these consumer laws allow you to recover attorney's fees and court costs so you can gain an attorney's help in Bedford, Dallas or Fort Worth and even file a lawsuit if necessary. Even a small claim has a good chance of resolution in your favor without having to spend more money than what your claim is worth. Today's post will explore your rights under Texas law in these situations.
What is a warranty?There are two types of warranties under Texas law: express warranties and implied warranties.
An express warranty is a guarantee to repair or replace a product or service provided. A warranty may be a separate transaction in addition to the underlying transaction to pay for goods or services. A warranty may instead be part of the single transaction in which the cost and benefit of the warranty are factored into the value of the good or service. Warranties often include specific terms about how long the guarantee lasts, what the warranty covers, how you must notify the other party of a claim under the warranty and so forth. When a warranty expires the guarantor no longer has an obligation under the guarantee unless the consumer extended the warranty.
An implied warranty is an assurance implied in contracts that the product or service will serve the expected basic function. An implied warranty is not stated in the sales contract. The contract terms imply its existence. Texas law identifies specific implied warranties for various types of transactions. The seller may disclaim implied warranties if the disclaimer meets the requirements under Texas law to do so.
Your rights when a business won't honor its warrantyYou have rights under a number of statutes and common law when a business fails to honor its warranty. An express warranty may give you limited rights of recovery. The most powerful remedy available in most cases is the Deceptive Trade Practices Act (DTPA). The DTPA is a powerful consumer law that creates statutory claims for breach of warranty and other consumer claims. DTPA is powerful because it gives consumers the right to recover attorney's fees and court costs. If the DTPA violation was knowing or intentional then the consumer can recover up to three times the consumer's loss. (Plus attorney's fees and costs.)
There are a variety of other statutes and common law claims available to a consumer. Often they are not as effective or valuable to the consumer. The risk of paying triple damages (treble damages) under DTPA and racking up attorney's fees often encourages early settlement. A Bedford business that digs its feet in on a $20 claim can see that claim turn into thousands of dollars due to attorney's fees. Paying $20 to make good on the warranty is a much better deal.