Which implied warranty is breached when the product is not fit for the buyer's stated purpose and the seller knew of that purpose?

• A. Implied warranty of merchantability
• B. Implied warranty of fitness for a particular purpose
• C. Reservation of rights letter
• D. Estoppel

Answer: (B)

When a seller knows exactly what the buyer intends to use the product for and the buyer relies on the seller’s expertise to select or furnish something suitable, the implied warranty of fitness for a particular purpose applies. This warranty requires that the goods be fit for the buyer’s stated purpose, given that the seller was aware of that purpose and the buyer trusted the seller’s guidance. If the product fails to perform for that intended purpose and the seller knew about that intended use, a breach occurs because the goods are not fit for the specific purpose the buyer relied upon.

In contrast, the implied warranty of merchantability covers goods being fit for ordinary or common uses, not the buyer’s unique stated purpose. The other options—such as a reservation of rights letter or estoppel—do not define or create this particular warranty. A reservation of rights letter relates to insurer communications, and estoppel is a legal doctrine about preventing contradictory claims, not the breach of a specific warranty.