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Exclusion of Liability Clauses

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Exclusion of liability clauses are designed to exempt a contracting party for breach of contract or negligence. If exclusion clauses are upheld in court the defendant has a complete defence for his action, for them to operate they must cover the breach. The individual wishing to rely on the clause must show that the clause formed part of the contract, either by notice, signature or a course of dealing. Exclusion clauses will only be valid if they are reasonable in accordance with the Unfair Contract Terms Act 1977 (UCTA) (CEM 2013), personal injury and death cannot be excluded at all.
Limitation of liability clauses are designed to limit the liability of a contracting party when a contract is breached to a pre-agreed amount. When such a clause is upheld in court for breach of contract, the party that is relying on the clause cannot be held liable for a figure that exceeds the stated amount, although the amount could be less if the claimant’s loss is less. Such a clause legally lessens the risk of a liability which will typically be a debt or obligation. Businesses may attempt to use disclaimers on products they sell to avoid liability in situations like customer misuse, however warranty laws may override any disclaimers of liability placed on products.
Fluctuation clause contracts are a way of dealing with inflation on large projects that may last a considerable time (Aeberli 2002). A fluctuation clause has the legal effect that in the event of a specified cost increase the seller is legally permitted to increase their price by a predetermined percentage of the base price of the product - the clause would be in place until a specified date and any changes would be legally binding to both parties in the contract. The legal effect would be that as long as the clause is understandable and clear when read in connection with the entire contract, then the clause would be

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