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Internet Retailers Fined for DelaysBased on consumer complaints, the Federal Trade Commission chargedseven Internet retailers with failure to give buyers enough notice of shippingdelays. These delays took place during the holiday shopping season. Someretailers had promised specific delivery dates, even though delivery by thosedates was virtually impossible. They also agreed to change their proceduresfor delivering orders. The retailers were accused of violating the mail andtelephone order rule, which requires retailers to ship orders by the datewarranted by their promise. The rule also states that if no date is promised, thegoods must be delivered within 30 days of the order. In settling this dispute, theretailers agreed to pay fines. (Source: InternetWeek, July 26, 2000)Connect Go to the Web sites of two or more online retailers, and check theirdelivery procedures and warranties.Implied WarrantiesAn implied warranty is a guarantee of quality imposed by law.An implied warranty is not in writing. Under the UCC, implied warrantiesapply only to goods that are sold; they do not encompass contractsfor services. A sale is the passing of ownership of a particularitem from a seller to a buyer for a price. There are three types of impliedwarranties:l Warranty of fitness for a particular purposel Warranty of merchantabilityl Warranty that comes from a course of dealing or usage of tradeWarranty of Fitness for a Particular PurposeA warranty of fitness for a particular purpose is created whenthe seller knows the purpose for which the goods are needed. The selleradvises the buyer in making a purchase, and the buyer relies on theseller’s knowledge and advice. In this way, the seller warrants byimplication that the goods will be fit for the purpose for which they areto be used. This warranty exists whether the seller is a merchant or aprivate party.Example 7. Susan Eng went to a paint store and told the proprietorshe needed the best paint to use on an outdoor concrete patio.The proprietor selected a gallon of paint from a shelf and toldChapter 14: The Importance of Warranties 301