Warranty vs Guaranty

Log Out | Topics | Search Moderators | Register | Edit Profile

Author Message Robin E. Snyder Senior Member Username: robin Post Number: 132 Registered: 08-2004 Posted on Tuesday, September 04, 2007 - 08:12 pm:    I know I have learned this once-upon-a-time...but I can't recall the differences in the terminology. Ronald L. Geren, RA, CSI, CCS, CCCA, SCIP Senior Member Username: specman Post Number: 517 Registered: 03-2003 Posted on Tuesday, September 04, 2007 - 08:53 pm:    CSI PRM-MOP, Page 5.188: Guaranty. To undertake collaterally to answer for the payment of another’s debt or the performance of another’s duty, liability, or obligation; to assume the responsibility of a guarantor; to warrant. Warranty. • A promise that a proposition of fact is true. • A promise that certain facts are truly as they are represented to be and that they will remain so, subject to any specified limitations. In certain circumstances, a warranty will be presumed; this is known as an implied warranty. Phil Kabza Senior Member Username: phil_kabza Post Number: 280 Registered: 12-2002 Posted on Tuesday, September 04, 2007 - 10:18 pm:    Therefore, the term warranty is frequently applied to the circumstances that would call for a guaranty, and vice-versa. The PRM does go on to explain that both terms come from the same etymological root. This fact is of little help if you are a CDT teacher trying to explain the content of the PRM to a group of thoroughly baffled (and unfortunately bored) CDT exam candidates. At about this time, we recommend throwing things at the students to wake them up, or serving one of the new high caffeine stimulant drinks. An alternative is to toss the students into a totally sustainable compost heap and sprinkle in a conversation about Level 1.5 of MasterFormat. Lynn Javoroski CSI CCS LEED™ AP SCIP Affiliate Senior Member Username: lynn_javoroski Post Number: 638 Registered: 07-2002 Posted on Wednesday, September 05, 2007 - 08:52 am:    So, if I warrant the roof, I'm swearing that the statements made about it are true - it's watertight. But if I guarantee the roof, I warrant it AND I'll pay to fix it. Ronald L. Geren, RA, CSI, CCS, CCCA, SCIP Senior Member Username: specman Post Number: 518 Registered: 03-2003 Posted on Wednesday, September 05, 2007 - 09:54 am:    Not necessarily. Essentially, a Guaranty is a third-party Warranty. For example, almost everything you purchase today is fabricated from parts by various product manufacturers, such as computers, appliances, automobiles, and including construction. The manufacturers of the individual components assembled in the unit provide a warranty on their parts. The fabricator of the assembled unit guarantees that those individual components will perform AND warrants that the assembled unit will perform as advertised. To use the roof example, the roof manufacturer provides a warranty that their roof materials will perform as advertised with certain limitations. The contractor (third-party) provides a guaranty that the same roof materials perform as advertised, and provides a warranty that the roof installation will perform as intended (won't leak). The industry treats the two terms as being interchangable, but they legally have different meanings. As the PRM states, the definitions they provide (quoted above) are from "Black's Law Dictionary." Bob Woodburn Senior Member Username: bwoodburn Post Number: 206 Registered: 01-2005 Posted on Wednesday, September 05, 2007 - 10:57 am:    I don't have a Black's Law Dictionary handy, but judging by the PRM definitions quoted above, the two words are both different AND interchangeable. The words are different because one is a verb ("guaranty") and one is a noun ("warranty"). As quoted above, that is. They are interchangable because one of the meanings of "guaranty" (that's the verb) is, in fact, "to warrant." In other words, "to warrant" is a synonym for "(to) guaranty." I suspect the real difference is one of customary usage -- using one term with certain subjects, the other with others. The difference seems to be cost-based. Outside the "legalese" usage (e.g., guaranteeing a loan), Guarantees are used most commonly for low-priced consumer goods ("satisfaction or your money back") where return of the purchase price amounts not only to liquidated damages and a limit of liability, but is also (to the manufacturer) a negligible amount. Because of that "money-back guarantee" connotation, the word is not as often used for high-ticket items, where full refunds would be a major potential liability. Have you ever heard the phrase "money-back 'warranty'"? Probably not. (Even a "no-dollar-limit" roof warranty is about repair or replacement--not a refund!) It's simply semantics, based on connotation (association, expectation and "tradition"). That's all. Robert W. Johnson Senior Member Username: bob_johnson Post Number: 160 Registered: 08-2004 Posted on Wednesday, September 05, 2007 - 11:54 am:    I would suggest that you read further in PRM 5.18 and in particular 5.18.2 about the similarities and differences between the two terms - there is a legal difference that is usually not recognized in business - guaranty is a third party agreement while warranty is an assurance by the principal - you guarantee someone else's work - you warrant you own product or work - a manufacturer warrants its products while a construction contractor provides a third-party guaranty on those same products and a warranty on his own workmanship in installing them.