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Question
Farmer Pete was looking to buy another small tractor for his operation. He asked his neighbor Walt, the local welder, if he knew of anyone that had a tractor to sell. Walt said "I have a tractor out back that I had repaired the hitch on for a customer, but when the customer couldn't pay the bill he gave me the tractor as payment. I'll sell it to you." Pete bought the tractor from Walt, but after having some trouble with it found that it had defective gaskets and would not run without major repairs. Is Walt liable for the bad tractor under a warranty theory?
No, Walt is not liable under the implied warranty of merchantability because he is not a merchant that deals in the sale of tractors. Yes, Walt is liable under the implied warranty of merchantability because a tractor with defective gaskets would not pass in the trade. Yes, Walt is liable under an express warranty theory because Walt said that he had fixed the tractor. No, Walt is not liable because he effectively disclaimed all warranties.
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