Okla. Stat. tit. 12A § 2-312

Current through Laws 2024, c. 9.

Section 2-312 - Warranty of Title and Against Infringement; Buyer's Obligation Against Infringement

(1) Subject to subsection (2) there is in a contract for sale a warranty by the seller that

(a) the title conveyed shall be good, and its transfer rightful; and

(b) the goods shall be delivered free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge.

(2) A warranty under subsection (1) will be excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title in himself or that he is purporting to sell only such right or title as he or a third person may have.

(3) Unless otherwise agreed a seller who is a merchant regularly dealing in goods of the kind warrants that the goods shall be delivered free of the rightful claim of any third person by way of infringement or the like but a buyer who furnishes specifications to the seller must hold the seller harmless against any such claim which arises out of compliance with the specifications.

Okla. Stat. tit. 12A, § 2-312

Laws 1961, p. 81, § 2-312.

Oklahoma Code Comment

(1) Previous Oklahoma law is in accord. "The sale of property in the vendor's possession implied a warranty of title. A warranty of title which is implied is a warranty as to the whole title, and it, therefore, protects against partial defects, liens, charges, and incumbrances by which the title transferred is rendered anything less than full, perfect and unencumbered." Clevenger v. Lewis, 20 Okl. 837, 95 P. 230, 16 L.R.A.,N.S., 410, 16 Ann.Cas. 56 (1908). Ordinarily seller of personally impliedly warrants title. Merchants' Bank v. People's Savings & Loan Ass'n, C.C.A., 70 F.2d 169 (1934). The previous Oklahoma decision limits the warrant to goods in the vendor's possession. The Commercial Code does not so limit the warranty.

The Commercial Code states that title "shall be good"-not that it "is" good. This is so worded to provide for contracts to deliver goods in the future. The contract is not breached by proof that the vendor does not have present title: it will be breached only by not having title at the time of transfer.

The Uniform Sales Act, which was not enacted by Oklahoma, included a separate provision to provide for a warranty of "quiet title." This provision has been omitted from the Commercial Code as unnecessary, but it may be important insofar as the statute of limitations is concerned. Under the Commercial Code, the warranty is breached at the time of transfer, and the cause of action accrues at that time, even though the breach may not be discovered until years later, and thus the remedy lost by limitations before damage occurs.

(2) A general disclaimer clause will not repudiate the implied warranty of title. However, the circumstances may be such that the buyer should not expect the seller to warrant title. Oklahoma has held that there is no warranty of title in a sale by sheriffs, executors, foreclosing lienors and the like. Streeter v. Anderson, 172 Okl. 113, 43 P.2d 53 (1935); Factor Oil Co. v. Brydia, 184 Okl. 113, 85 P.2d 311 (1939) .

(3) There are no previous Oklahoma decisions. There has been confusion among the decisions in other states as to whether the warranty of title includes a warranty against infringement. Also, many of the courts did not grant protection unless the vendee's right to use the goods was actually interrupted by injunctions or other acts. Under the Commercial Code a cause of action arises upon a rightful claim. This is not spelled out clearly by this section, but other provisions do so.