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Brokke v. Williams - 235 Mont. 305, 766 P.2d 1311 (1989)

Rule:

Warranty of title is not subject to the disclaimers found in Mont. Code Ann. § 30-2-316 pertaining to fitness and merchantability.

Facts:

Defendant Albert Williams operated a pawnshop in Montana. Plaintiff Paul Brokke purchased a Pentax Super Program camera from Williams’ shop. Thereafter, Brokke was notified by the police department that the camera was stolen property. He was directed to surrender the camera. Plaintiff then returned to the pawnshop and requested a refund for his purchase of the stolen merchandise. Williams refused to refund Brokke, arguing that he had no knowledge that the merchandise was stolen property. Furthermore, Williams contended that he disclaimed any warranty of title to goods sold in his business by way of large fluorescent signs posted, which alerted buyers that the merchandise sold on the premises is sold "as is," and by writing the same on his sales receipts. The District Court found that Brokee was entitled to a refund. Williams sought reversal of the judgment.

Issue:

Can a merchant disclaim responsibility for furnishing title to the goods sold in his business by placing “sold as is” signs in his establishment?

Answer:

No.

Conclusion:

The Court found that Williams breached the warranty of title required by Mont. Code Ann. § 30-2-312 when it sold stolen goods to Brokke because even an unknowing successor could not pass clear title to stolen goods. Moreover, the Court averred that warranty of title was not subject to the disclaimers found in Mont. Code Ann. § 30-2-316 pertaining to fitness and merchantability. Finally, the Court found that the sign did not meet the disclaimer of warranty of title found in Mont. Code Ann. § 30-2-312(3).

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