The “AS-IS” Clause: What it Does and How To Use It

You have probably seen an AS IS clause in many of your creative services agreements, typically in bold or ALL CAPS. What are they for and how should you approach them?

A typical AS IS clause might read as follows:

Except as represented in this agreement, all work product by Developer is provided “AS IS”. Other than as provided in this agreement, Developer makes no other warranties, express or implied, and hereby disclaims all implied warranties, including any warranty of merchantability and warranty of fitness for a particular purpose.

Warranties are simply promises about quality or features. For example, in software development a client might ask for a warranty that the code contains no viruses. Or in design, a client might ask for a warranty that the work is original.

Despite the formal and cumbersome language, the purpose of this clause is pretty straightforward. It simply means that the only warranties about the work are the ones written in the contract.

Admittedly, the typical “AS-IS” wording is off-putting for clients. It sounds as though the service provider is just dumping its work on the client and washing its hands of the whole thing: as-is, take it or leave it. And that’s too bad because it often leads to a negotiation about whether to include the clause at all when the proper discussion should be about what types of warranties are appropriate for the client to request and a service provider to give. And that’s the real point of any contract: to get everyone on the same page before work begins.

So, some takeaways:

  • Contracts for design and development services should generally include a warranty disclaimer.
  • Use the clause above or something simpler like: “Except as written in this agreement, Developer’s work product is provided “AS IS”.
  • The warranty disclaimer must be bold, in CAPS, or otherwise conspicuous to be effective.
  • It is reasonable for a client to ask for certain warranties, though what is reasonable depends a lot on the circumstances.
  • If a client resists the “as-is” statement, start a discussion about what types of warranties the client is expecting and try to find agreement there.
  • Head off the need for negotiation about warranties by including in your contract those promises that you are willing to stand behind.
  • Ask your lawyer for help to draft any standard warranties you want to offer.

So get right with your clients by including a warranty disclaimer and having a meaningful discussion about what really is expected by the client and promised by the service provider.

Learn about more common provisions in our (ongoing) series, Anatomy of a Services Agreement.