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ARTICLE · 28 SEPTEMBER 2026

How Can A Limitation Of Liability Clause Help My Business?

LegalVision
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Businesses can apply separate caps to different risks, but the contract must state which claims and indemnities fall under each cap.

AustraliaReal Estate and Construction
Kristine Biason
Kristine Biason
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Summary

  • A limitation of liability clause can cap damages and exclude specified losses, including loss of profit or goodwill.
  • Businesses can apply separate caps to different risks, but the contract must state which claims and indemnities fall under each cap.
  • UK law prevents businesses from excluding liability when negligence causes death or personal injury.
  • This guide explains limitation of liability clauses for suppliers and customers entering commercial contracts in the UK.
  • LegalVision’s contract lawyers advise businesses on selecting liability caps, excluding loss types, negotiating indemnities and preserving enforceable remedies.

Tips for Businesses

Define whether a liability cap applies to each claim or all claims combined. State the reference period, currency and treatment of tax. Test the cap against likely losses and insurance exclusions. Record the commercial reasons supporting the allocation. Speak to a contract lawyers at LegalVision about drafting liability caps

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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