Limitation of Liability

Limitation of Liability is a clause used to restrict the amount one Party that breaches a Contract needs to pay another Party suffering a loss.

The  provision may apply to the entire business arrangement or only to certain breaches, depending on the parties’ agreement.

It is commonly some fraction or multiple of the value of the fees paid or expected to be paid by the affected Party over the preceding 12 months.

Courts generally uphold limitation of liability clauses, but it’s important to remember that some states do not uphold it in certain circumstances.

You can easily search for this clause within your contracts with the Global Search engine within Gatekeeper. 

This easy searchability improves visibility, helps you to make informed business decisions and escalate issues accordingly.