Information within a manufacturer’s brochure can act as a warranty. In several scenarios, the manufacturer will not be a party to the written contract; however, if the manufacturer publishes a brochure that includes information on a product that is then sold by a seller, that brochure is intended to be a sales tool, and the information within the brochure can be treated as a representation, and may also include a warranty.

Thus, if you are the manufacturer of a product, ensure that you are aware of the representations made within the promotional material that you publish. Murray v. Sperry Rand [1979 Ont HC] stands as precedent for these rules. In this case, the plaintiff bought farm machinery based on representations made within a brochure. The brochure was published by the manufacturer of the product, a third party to the transaction. The seller had not made the same representations as for the manufacturer, nor did the contract refer to the representations or the brochure.

The plaintiff found that the farm machinery did not work as the brochure representations stated that it will. The court found that the manufacturer is said to have entered a collateral (secondary) contract with the buyer.

The manufacturer’s brochure was intended to be a sales tool to entice buyers into entering into contracts with the sellers. It can be inferred from the court’s conclusion that when Party C makes a representation induce Party A into entering a contract with Party B , then the representation can draw Party C into a collateral contract with Party A and B.

 

–  –  –

This article is provided for informational purposes only and does not create a lawyer-client relationship with the reader. It is not legal advice and should not be regarded as such. Any reliance on the information is solely at the reader’s own risk. Clausehound.com is a legal tool geared towards entrepreneurs, early-stage businesses and small businesses alike to help draft legal documents to make businesses more productive. Clausehound offers a $10 per month DIY Legal Library which hosts tens of thousands of legal clauses, contracts, articles, lawyer commentaries and instructional videos. Find Clausehound.com where you see this logo.

What you don't know can hurt you! Subscribe to stay informed.

Sign up now and receive an email when we publish new content.

We will never give away, trade or sell your email address. You can unsubscribe at any time.