Definition
A contractual term, used primarily in sales of goods, signifying that a buyer accepts the goods in their existing condition, including all defects and faults present at the time of sale. A sale made "with all faults" or "as is" shifts the risk of hidden and visible defects from the seller to the buyer. The seller is not liable for defects that the buyer could have discovered upon reasonable inspection, nor for latent defects that fall within the ordinary range of imperfection for goods of that description — provided the seller has not committed fraud.
The protection afforded to the seller under an "all faults" sale is not absolute. It does not cover defects so fundamental that they render the goods something other than what was described. A seller cannot invoke the clause to escape liability for delivering goods that fail to match their essential identity. If goods are sold as a specific described thing, any defect that makes them something different in kind falls outside the clause's protection. Fraud on the part of the seller likewise voids the shelter of the clause entirely.
Common Confusion
"All faults" and "as is" are functionally equivalent in most commercial contexts and are often used interchangeably in modern practice. "As is" has largely displaced "all faults" in American commercial drafting, particularly under the Uniform Commercial Code framework. Researchers reading historical contracts, sale records, or older case law will encounter "all faults" where a modern instrument would say "as is." The two terms should be treated as synonyms in most analytical contexts, though "all faults" carries a stronger historical common-law pedigree.
Why It Matters in Research
This term appears most frequently in pre-UCC contract disputes, English common law reporters, and early American commercial case law. Researchers should be aware that the phrase carries a specific doctrinal contour that is slightly narrower than a casual reading suggests: the clause protects against defects within the identity of the goods, not against misidentification of the goods themselves. That distinction — between a defective example of the thing sold and something that is not the thing sold at all — is the live edge of the doctrine and the source of most litigation over the clause.
Historical sources using this term often arise in disputes over livestock, secondhand goods, bulk commodities, and salvage sales. When reading older decisions, researchers should track whether the court is applying the clause to a defect-within-identity situation or whether the buyer is arguing a fundamental misdescription, since courts treated these differently even while purporting to apply the same rule.
The fraud exception is consistently recognized across sources but underspecified. Historical cases rarely define what level of concealment or misrepresentation crosses into fraud sufficient to override an "all faults" clause. Researchers pursuing that question will need to cross-reference the broader fraud-in-the-inducement literature rather than relying on "all faults" cases alone.
Modern researchers encountering "all faults" language in admiralty or marine insurance contexts should note that the term has a parallel but distinct usage in that field, where it appears in hull policies and cargo coverage. The admiralty application involves fault allocation in collision and damage contexts rather than contractual sale terms, and the doctrinal frameworks do not transfer directly.
Historical Dictionary Support
Bouvier's is the primary historical source available for this term, and its treatment is concise but instructive. Bouvier states the rule clearly: an "all faults" sale covers defects not inconsistent with the identity of the goods as described. The two supporting references — one Massachusetts decision and one English King's Bench report — establish that the rule was recognized on both sides of the Atlantic and treated as a settled principle of commercial law by the mid-nineteenth century.
Bouvier's partial quotation of the underlying rationale ("the purchaser shall make use of his eye and understanding to discover what faults the...") reflects a caveat emptor philosophy that pervaded nineteenth-century sales law. The buyer who agrees to take goods with all faults is understood to have assumed the inspection obligation; the seller's duty of disclosure is correspondingly reduced, except where fraud intervenes.
What Bouvier's does not address is how courts handled the clause when the defect was genuinely latent — invisible to any reasonable inspection. Later English and American case law developed more nuanced positions on this question, and researchers should not assume that Bouvier's summary captures the full range of outcomes in hidden-defect cases.
Jurisdictional Note
The "all faults" clause is a common-law doctrine that predates codified sales law. In American jurisdictions, its practical operation has been substantially absorbed into the "as is" framework of UCC Article 2, which governs disclaimer of implied warranties. English law developed the rule along parallel but not identical lines. Researchers working in pre-UCC American sources or in non-UCC contexts (real property, certain services, admiralty) should apply the common-law framework rather than importing UCC analysis.
Encyclopedia Cross-Reference
The Law Mind Military, Veterans & Admiralty Law Encyclopedia — Collision: Navigation Rules (COLREGS), Fault, and Divided Damages