I’ve written lots about represents and warrants (and representations and warranties), culminating in a series of posts a couple of years ago. See, in reverse chronological order, this post, this post, this post, and this post. With the last of those posts, I felt as if for the time being I’d said pretty much all I could say. And I felt that my position—that using represents and warrants in a contract is pointless and confusing—couldn’t reasonably be disputed.
But there’s no room for standing pat in the marketplace of ideas—you have to be prepared to keep restating your position. What’s prompting me to venture into the fray again is the following account in the third edition of Garner’s Dictionary of Legal Usage, the first paragraph of which draws from Black’s Law Dictionary (Bryan A. Garner ed., 9th ed. 2009):
representations and warranties. Although most contracts have a section so designated, there is widespread doubt about the precise difference between a representation and a warranty. One theory, not far from the truth, is that a representation amounts to a statement that the present situation is so-and-so, while a warranty is a guarantee that it will be so in the future. In fact, though, there are four salient differences between them: (1) a warranty is conclusively presumed to be material (therefore giving rise immediately to a claim for breach), while the burden is on the party claiming breach to show that a representation is material; (2) a warranty must be strictly complied with in every particular, while substantial truth is the only requirement for a representation; (3) a warranty is an essential part of a contract, while a representation is usually only a collateral inducement; and (4) an express warranty must be written on the face of the document, while a representation may be written or oral.
Some have asked this: if the warranty gives so much more protection than a representation, why not simply use warranty alone—without representation? It’s a fair point, perhaps, but here’s the reason for sticking to both: some parties to a contract don’t want merely a guarantee that so-and-so will be so in the future; they also want an eye-to-eye statement (representation) that the thing is so now. If it later turns out not to have been so when the representation was made, the the party claiming breach can complain of a lie. (See lie.) If only a warranty were in place, the breaching party could simply say, “I’ll make good on your losses—as I always said I would—but I never told you that such-and such was the case.” Hence representations and warranties.
I’m not sure what to make of this analysis, stripped as it is of all context. I’m inclined to take issue with components of it, not to mention the tone of the thing. (For example, the reference to “truth.”)
But more to the point, as guidance for contract drafters, it’s counterproductive. It fails to consider what, if anything, drafters think they’re doing when they use represents and warrants. It fails to offer any support for the supposed implications of the words representation and warranty. (That’s understandable—there is none.) And it ignores the fact that rather than engaging in magic-wordery and expecting the reader to discern obscure doctrinal nuances of dubious relevance, drafters can state clearly whatever remedies regime they desire.
For more on this, consult the blog posts I link to above.