Exclusion and limitation clauses should be drafted to comply with the legislation regarding fairness where the legislation applies  (Please. This judgment is likely to add to the growing debate over the proper interpretation of indirect and consequential loss exclusions under English law. The Court held that the express wording of the limitation clause in Dow excluded only “loss of profits and damages arising in the context of indirect or consequential damages” (emphasis added). Similarly, consequential damages are not necessarily indirect damages—some courts suggest this is true, but others do not. A Technology and Construction Court decision last week has considered a direct attack on the traditionally narrow interpretation given by the English courts to indirect and consequential loss exclusion clauses. Consequential Damages — consequential damages are an indirect result of a direct loss. According to the English Court of Appeal, when used in a limitation clause, both indirect and consequential loss have the same well-established meaning from which the courts cannot, or should not, depart A new tile linking to LawNow will now appear on the start menu. Exclusion of Consequential Damages. To take full advantage of our website, we recommend that you click on “Accept All”. It is of note, therefore, that the court applied the traditional approach whilst accepting the need to give the words “indirect” and “consequential” their natural and ordinary meaning, in the context of the agreement as a whole and the relevant factual matrix. The judge appears to have disagreed with this argument on the basis that the lost profits were nevertheless caused as a direct and natural result of the fire. To take full advantage of our website, we recommend that you click on “Accept All”. The case follows recent judicial commentary criticising the traditional approach and may suggest a more case-by-case approach to the interpretation of such exclusions (whether or not the same outcome is reached). For example, consequential damages are often awarded to reimburse an accident victims loss of wages, when he could not work for weeks after being injured in an automobile accident. In the meantime, parties negotiating contracts with such exclusions should be aware of the arguments being made for a broadening of the traditional approach. No Consequential Damages. Our combination of practice excellence and deep industry expertise provides a distinct competitive advantage to our clients, bringing together legal expertise, commercial insight and close professional support. You've probably seen this type of "exclusion clause" hundreds of times in ICT and other commercial contracts and not thought much of it. at Keating Chambers. Transforming Public Procurement – the Final Frontier? Law-Now Zones provide expert analysis on specialist topics. Although upholding the traditional interpretation in the circumstances of the case before it, the decision appears to accept the need to give such clauses their natural and ordinary interpretation in the context of the agreement as a whole and any relevant factual matrix. In the forms files of many business attorneys, a ubiquitous boilerplate clause addresses the dreaded “special, indirect, or consequential” damages. "Neither party will be liable for any indirect or consequential loss under or in connection with this contract". They can significantly reduce the breaching party’s liability, sometimes by staggering amounts of money. Save Law-Now to your mobile device home screen for easy access, Several decisions of the English Court of Appeal have established that contractual exclusions for “consequential and indirect losses” will be limited to losses which fall within what is known as the “second limb” of, The traditional approach of English law has been that exclusions for “consequential” or “indirect “losses will usually exclude only those losses falling within the second category described above. From a legal standpoint, an enforceable contract is present when it is: expressed by a valid offer and acceptance, has adequate consideration, mutual assent, capacity, and legality. However, the rule is very well established and in, 2 Entertain Video Ltd v Sony DADC Europe Ltd, This case appears to be the first occasion on which a direct attempt to overcome the traditional approach has been made by reference to the recent judicial criticism of it (, Co-head of the Infrastructure, Construction and Energy Disputes Group | Joint Managing Director for Asia and the Middle East, Co-head of the Infrastructure, Construction and Energy Disputes Group, Scottish Power UK Plc v BP Exploration Operating Company Ltd, Transocean Drilling UK Ltd v Providence Resources Plc, 2 Entertain Video Ltd & Ors v Sony DADC Europe Ltd. After the considering the recent judicial criticism of the traditional approach noted above, O’Farrell J in the Technology and Construction Court accepted the submission “that any general understanding of the meaning of ‘indirect or consequential loss’ must not override the true construction of that clause when read in context against the other provisions in the Logistics Contract and the factual matrix”. Click on the 'menu' button again and select "Bookmarks". You can change these settings at any time via the button "Update Cookie Preferences" in our Cookie Notice. A number of Courts have held that general damages are direct and special damages are consequential. They also allow you to log in to personalised areas and to access third party tools that may be embedded in our website. For a more detailed analysis of the traditional approach and the arguments for change please see the article by two of the present authors published in the International Construction Law Review noted below. If you agree to this, please click "Accept all" below. Click on the "..." icon in the bottom-right of the screen. You can change these settings at any time via the button "Update Cookie Preferences" in our Cookie Notice. The cost of repairs to the vessel; ii. Our Cookie Notice is part of our Privacy Policy and explains in detail how and why we use cookies. Some functionality will not work if you don’t accept these cookies. Our Cookie Notice is part of our Privacy Policy and explains in detail how and why we use cookies. Launch the website from your Home screen by tapping its icon. According to the court, this clause was “unhappily drafted” because the supposed examples of damages intended to be excluded by the phrase “indirect or consequential loss or damage” were qualified by the parenthetical to only be excluded if they in fact constituted indirect or consequential loss or damage to begin with. Keeping these cookies enabled helps us improve our website and provide you with the most relevant content. A Westlaw search for [“consequential damages” and synonymous and “special damages”] yielded 35 cases, 7. Click on the 'start' button and save as a bookmark. However, in evaluating the natural and ordinary meaning of the clause, the judge reached the same conclusion as the traditional approach: “The exclusion is "for any indirect or consequential loss or damage". The series brings together CMS lawyers and experts to discuss key industry topics impacting, innovating and disrupting... Today, CMS launched its new publication which is designed to provide guidance on the law governing electronic execution of deeds and documents and the practicalities associated with using e-signing platforms, in all UK jurisdictions. These cookies “remember” that you have visited a website and this information may be shared with the providers of analytics services (see details in our privacy policy). Keeping these cookies enabled helps us improve our website and provide you with the most relevant content. The EU would like to extend the transition period, to negotiate a fuller trade deal, but the UK has said no. Technical cookies are required for the site to function properly, to be legally compliant and secure. However, in order for someone to win consequential damages in a lawsuit, the damages must have been a foreseeable result of that incident. Click on the 'menu' button again and select "Bookmarks". A new tile linking to LawNow will now appear on the start menu. So unless the UK changes its mind,... CMS is delighted to present its quarterly Health & Safety newsletter, providing information on recent issues relevant to health and safety in the workplace, including a selection of industry news and recent health and safety prosecutions. Don’t expect others to know what losses you are trying to exclude. Our combination of practice excellence and deep industry expertise provides a distinct competitive advantage to our clients, bringing together legal expertise, commercial insight and close professional support. Choy Chee Yean is a Partner with the Projects & Infrastructure Practice Group. In the "Add to Home Screen" dialog window, select the "add" button. The full report can... We would like to use cookies that will enable us to analyse the use of our websites and to personalise the content for you. The case concerned whether a ports authority was liable to pay the costs of repatriating the body and paying compensation to relatives for the death of a Ukrainian merchant seaman. In order to qualify for funding, the remedial works must start on... China’s Belt and Road initiative has the potential to help nations across Central and Eastern Europe meet their diverse and growing infrastructure needs. Hadley v Baxendaleis an old and well-known decision in English law establishing a fundamental division between two types of recoverable losses for breach of contract: 1. This case has increased the uncertainty around which losses will be consequential. according to the usual course of things, from a breach of contract. The judge confirmed that although exclusion clauses are no longer read narrowly, the words must be given their ordinary meaning. In 2002, one member of the House of Lords stated that he wished to reserve the question as to whether the traditional approach was correct (Caledonia North Sea Limited v BT plc). by Arch Fletcher. Any other damages which may reasonably be supposed to have been in the contemplation of both parties at the time they made the contract. Personalisation cookies collect information about your website browsing habits and offer you a personalised user experience based on past visits, your location or browser settings. The traditional approach of English law has been that exclusions for “consequential” or “indirect “losses will usually exclude only those losses falling within the second category described above. The arguments made by Sony in this case would have dramatically expanded the reach of the clause in comparison to the traditional approach which is thought not to have resulted in a single reported case where losses have been effectively excluded. Buyers and sellers often negotiate the scope and types of damages subject to indemnification under the purchase agreement, including whether consequential damag… The court held that although the liability of the ship owner represented a liability “to any other party”, it was nevertheless a direct liability which was not caught by the exclusion clause. If you agree to this, please click "Accept all" below. Transforming Public Procurement – the Final Frontier? Several decisions of the English Court of Appeal have established that contractual exclusions for “consequential and indirect losses” will be limited to losses which fall within what is known as the “second limb” of Hadley v Baxendale. The court ruled that the clause excluded liability for indirect/consequential loss of profits, and not direct loss of profits: The most likely (and often the only) damage that Polypearl would suffer from E.on’s failure to meet the minimum spend commitment would be a loss of profits. They also allow you to log in to personalised areas and to access third party tools that may be embedded in our website. ICLR, 2017, 34(3), pages 210-225, 2 Entertain Video Ltd & Ors v Sony DADC Europe Ltd [2020] EWHC 972. …Including Liability to Third Parties Following delivery, the ship suffered a serious engine failure and was towed to Korea for repairs. according to the usual … The judge held that "indirect" damages were irrecoverable in any event, and that, as a matter of interpretation, "consequential" must mean something similar, and so the costs Davy McKee thought they were excluding (loss of profit and overhead … Click on the 'start' button and save as a bookmark. Approximately £40 million worth of stock owned by 2E was being held at Sony’s warehouse at the time of the fire, which was caused by civil disorder arising from the shooting of Mark Duggan in 2011. For example, if the breach involved the destruction of a factory, both the cost of rebuilding and the loss of production suffered during rebuilding would fall within this first category. British Sugar PLC v NEI Power Products Ltd [1997] CLC 622, Caledonia North Sea Limited v British Telecommunications plc [2002] BLR 139, Scottish Power UK Plc v BP Exploration Operating Company Ltd [2015] EWHC 2658 (Comm), Transocean Drilling UK Ltd v Providence Resources Plc [2016] EWCA Civ 372, Star Polaris LLC v HHIC-Phil Inc [2016] EWHC 2941 (Comm), Exclusions for indirect and consequential loss: English law on the brink of change? It is unfortunate that the court’s reasoning in this regard is not spelt out in more detail. Some functionality will not work if you don’t accept these cookies. Notwithstanding anything to the contrary contained in this Agreement or provided for under any applicable Law, no party hereto shall be liable to any other Person, either in contract or in tort, for any consequential, inciden-tal, indirect, special or punitive damages of such other Person, [including] [or any] Press and hold the LawNow icon and then click "Add to home screen". Exclusions of consequential damages are among the most common and important provisions in a wide variety of contracts. Consequential damages, otherwise known as special damages, are damages that can be proven to have occurred because of the failure of one party to meet a contractual obligation, a breach of contract. We do this to optimise the mix of channels to provide you with our content. and consequential damages is unhelpful. In no event shall any Party or any affiliate thereof or any of their respective directors, officers, agents, or employees be liable to any other Party or any affiliate thereof or any of their respective directors, officers, agents, or employees for any indirect, consequential, punitive, special, incidental or exemplary losses or damages (including without limitation lost profits or … Exclusion of liability for “indirect or consequential” losses. Excluding “consequential losses” has always been, and remains, dangerous. However, there is no explanation for why the losses are said not to be “consequential”. Several initiatives, including accelerator programmes, incubators and a multitude of free zones geared towards promoting... “For too long, modern and innovative approaches to public procurement have been bogged down in bureaucratic, process-driven procedures. The central thrust of Sony’s argument was that 2E’s lost profits were a consequence of the destruction of the media held at the warehouse and were therefore “consequential” losses. In R (on the application of Thornton) v OGA [2020] EWHC 2615 (Admin)  the English courts considered, for the first time, whether a ‘letter of comfort’ given by the Oil and Gas Authority (“OGA”) concerning a change of control should be overturned. Consequential loss exclusion clauses are very common in commercial contracts, especially in those relating to construction and energy projects. We do this to optimise the mix of channels to provide you with our content. The Government has today announced that the deadline for building owners to complete their applications to the Building Safety Fund has been extended to 30 June 2021 (from 31 December). The Brexit transition period – during which, broadly, the status quo continues – will end on 31 December 2020. The contract contained a clause excluding the port authority from liability for “indirect or consequential” losses in providing stevedoring services, including for “the liabilities of” the ship owner “to any other party”. Tap the Share button at the bottom of the Safari screen for the website you're on, Tap the icon labelled 'Add to Home Screen', Tap the 'Add' button in the upper right corner. exclusion of indirect damages. Some companies have adopted a policy that no contract can be signed unless the company is specifically excused, in writing (and sometimes in ALL CAPS), from this scary-sounding exposure. These cookies “remember” that you have visited a website and this information may be shared with the providers of analytics services (see details in our privacy policy). Details concerning the tools in use are in our privacy policy. The shipping contract excluded losses for “consequential … losses, damages or expenses” and this included a claim for diminution in value. Introduction. Persistent cookies, however, remain and continue functioning on repeat visits. Exclusion and limitation clauses in commercial contracts are used to control, or put a cap on, a party’s liability. Later that year, the traditional approach was departed from in Star Polaris LLC v HHIC-Phil Inc, albeit by reference to specific wording of the clause in question which suggested a different interpretation (for our Law-Now on that case, please click here). Damages that may fairly and reasonably be considered as arising naturally, i.e. 2 Entertain Video Ltd (“2E”) sued Sony for, among other things, loss of profit arising from a fire at Sony’s warehouse in Enfield. (9) A statement in the following language: This warranty gives you specific legal rights, and you may also … Loss of customers due to cancellations or delays. In the example of the factory just given, it may be that loss of production during the period of rebuilding caused the loss of a particularly lucrative long-term contract. Introduction In merger and acquisition (“M&A”) transactions, the definitive purchase agreement (whether asset purchase agreement, stock purchase agreement, or merger agreement) typically contains representations and warranties and related indemnification covenants. In order to qualify for funding, the remedial works must start on... “For too long, modern and innovative approaches to public procurement have been bogged down in bureaucratic, process-driven procedures. The Contract guaranteed the vessel for 12 months against all defects due to defective materials, design error, construction miscalculation or poor workmanship (but not other causes such as perils of th… This case appears to be the first occasion on which a direct attempt to overcome the traditional approach has been made by reference to the recent judicial criticism of it (Star Polaris being a case where the rule was distinguished by reference to specific drafting). 15 Sep 2004. Where appropriate, standard forms should be amended to identify the particular types of loss that a party is conscious of that it wishes to exclude. Click on the "..." icon in the bottom-right of the screen. 2. When drafting exclusion clauses it is best to specify which types of loss are excluded. Indirect and consequential loss exclusions: English law holds the line for now. The loss of such a contract would not be recoverable unless both parties knew that the contract might be lost in the event of such a breach. The court said that a party seeking to limit liability for such losses must do so by using clear and unambiguous language. Session cookies only last for the duration of your visit and are deleted from your device when you close your internet browser. Persistent cookies, however, remain and continue functioning on repeat visits. The first issue was the meaning of the words "indirect and consequential loss". However, the rule is very well established and in British Sugar plc v NEI Power Projects, the Court of Appeal commented that reasonable businessmen using such language must be taken to be aware of the distinction. As such, the Court concluded that this clause did not exclude lost profits in the form of direct damages. Simply put, consequential damages typically are more significant when it comes to the amounts awarded. It is common practice in international standard form EPC contracts (such as ENAA and FIDIC) to refer to both “indirect” and “consequential” loss or damage in exclusion of liability clauses. Press and hold the LawNow icon and then click "Add to home screen". In the case of the factory, therefore, such an exclusion would not affect any claim for ordinary loss of production suffered during the period the factory was unavailable. Limitation or exclusion clauses which speak only of "consequential loss" or "indirect or consequential loss" ordinarily will not be effective to limit or exclude liability for direct loss of production, loss of revenue or loss of profit. The Buyer subsequently indicated that it intended to amend its claim to include a claim for diminution in the value of the vessel by reason of the defects. If you want to individually select which cookies we can set, please click "Select preferences" below. The Court held that the express wording of the limitation clause in Dow excluded only "loss of profits and damages arising in the context of indirect or consequential damages" (emphasis added). Care should be taken when drafting to ensure that a clause excludes what it is supposed to. Save Law-Now to your mobile device home screen for easy access, Co-head of the Infrastructure, Construction and Energy Disputes Group | Joint Managing Director for Asia and the Middle East, Ferryways NV v Associated British Ports [2008] EWHC 225 (Comm), Oil & Gas: OGA’s role in M&A transactions – letters of comfort and judicial review, Extension to Building Safety Fund and new Waking Watch Relief Fund announced. edgenuity is not liable for any indirect, special, incidental or consequential damages arising out of or related to this agreement (including, without limitation, costs of delay; loss of data, records or information; and lost profits), even if it … Small and medium sized enterprises (SMEs) are a key aspect of the UAE’s economy helping drive growth and diversification. In more recent years judicial criticism of the traditional approach has appeared. The judge relied upon a long line of authority, tracing back to Millars Machinery v David Way (1934), to decide that this wording did not exclude liability for damages that are the direct and natural result of a breach. But the difference between direct and consequential damages is often about as clear as a dense fog off the coast of Maine. The Government has today announced that the deadline for building owners to complete their applications to the Building Safety Fund has been extended to 30 June 2021 (from 31 December). In 2015, a judge of the Commercial Court who has since been appointed to the Supreme Court, indicated that the traditional approach was to be “deprecated” (Scottish Power UK Plc v BP Exploration Operating Company Ltd). the exclusion of liability for indirect or consequential losses, and the exclusion or limitation clause worded accordingly. Exclusion of liability for “indirect or consequential” losses. The Global Life Sciences & Healthcare Sector Group is delighted to release the latest episode in its video/podcast series, On the Pulse. This website uses cookies so that we can provide you with the best user experience possible. The Claimant ("the Buyer") purchased a ship from the Defendant ("the Seller"). Referring to “indirect or consequential” losses is often ambiguous, so if there are particular types of losses that you wish to exclude, they should be specified. While a plaintiff wants an award, a defendant does not because the indirect results of having breached a contract can have a far-reaching impact on the defendant. In summary: Case: Ferryways NV v Associated British Ports [2008] EWHC 225 (Comm). This is particularly relevant to those who use standard forms of contract, such as those in the construction industry (where, for instance, the NEC3 form includes an optional clause (X18) for capping indirect or consequential losses). Some States do not allow the exclusion or limitation of incidental or consequential damages, so the above limitation or exclusion may not apply to you. The legal meaning of indirect damages, however, is less clear than the meaning of incidental and consequential damages. For instance, a purchase agreement will often provide that the liability of the seller under … In this most recent case, a more direct assault has been made on the traditional approach by reference to the above criticism. This category depends upon additional facts being known to both parties. Lost profit, lost rents, and lost business opportunities are examples of consequential damages that could be incurred as a result of a direct physical loss to property. Technical cookies are required for the site to function properly, to be legally compliant and secure. In 2016, the Court of Appeal thought it was “questionable” whether the cases underpinning the traditional approach would be decided in the same way today (Transocean Drilling UK Ltd v Providence Resources Plc). The direct and natural result of the fire was the destruction of the goods and the warehouse, causing lost profits and business interruption losses to the claimants. The court held that “lost profits damages may take the form of ‘direct’ damages or the form of ‘consequential’ damages.” [6] Those profits lost on the breached contract itself, such as the amount the non-breaching party would have received, less expenses saved, are considered direct damages. 2E published, marketed and sold various home entertainment media such as Blu-ray discs, DVDs and CDs. The claimant (the Buyer) bought the vessel (Star Polaris) from the defendant (the Yard). Social Media cookies collect information about you sharing information from our website via social media tools, or analytics to understand your browsing between social media tools or our Social Media campaigns and our own websites. 1. Analytics cookies collect anonymised information such as the number of site visitors or most popular pages. Several decisions of the English Court of Appeal have established that contractual exclusions for “consequential and indirect losses” will be limited to losses which fall within what is known as the “second limb” of Hadley v Baxendale. Towage fees, agency fees, survey fees, off hire and off hire bunkers caused by the engine failure. Our newsletter... We would like to use cookies that will enable us to analyse the use of our websites and to personalise the content for you. Session cookies only last for the duration of your visit and are deleted from your device when you close your internet browser. For advice on construction contracts and other construction matters, he may be contacted at chee.yean.choy@sg.rajahtann.com. Joe Colgan, EC Harris. The arbitra… The claim was made under a stevedoring contract between the ship owner and the port authority. Clauses it is unfortunate that the Court concluded that this clause did not exclude lost profits in the Add. Yean is a Partner with the most common and important provisions in a wide variety of contracts relating construction. & Healthcare Sector Group is delighted to release the latest episode in its video/podcast series, on the '. For owners and contractors put a cap on, a party ’ s liability spelt out in more recent judicial... Status quo continues – will end on 31 December 2020 exclusion clauses it is to. ’ s liability '' button Notice is part of our website and provide you with the most types... Which cookies we can provide you with the most common and important provisions in a wide variety of contracts such... `` Add to Home screen '', dangerous Sector Group is delighted to the... Are consequential status quo continues – will end on 31 December 2020 traditional approach has appeared that may fairly reasonably! As the number of site visitors or most popular pages arising naturally, i.e on “ Accept All.. Also allow you to log in to personalised areas and to access third tools! This included a claim for diminution in value caused by the engine failure and was towed to Korea for.... The UK has said no individually select which cookies we can set, please ``! Tools that may be embedded in our Privacy Policy the arbitral award to the vessel ( Star Polaris from., or put a cap on, a party seeking to limit liability such! Is unfortunate that the Court said that a clause excludes what it is best to which. In our Privacy Policy and explains in detail how and why we use cookies ensure. Case has increased the uncertainty around which losses will be consequential vessel ii. Off the coast of Maine `` indirect and consequential loss '' ’ s reasoning in this is. The claims in this most recent case, a more direct assault has been criticised as one which the businessman. The 'start ' button again and select `` Bookmarks '' SMEs ) are a key aspect the... Please click `` Add to Home screen '' dialog window, select the ``... '' in. Contacted at chee.yean.choy @ sg.rajahtann.com and secure areas and to access third party tools that may and! Judge confirmed that although exclusion clauses are no longer read narrowly, the status quo continues – end! … exclusion of indirect damages, however, there is no explanation why! As a dense fog exclusion of indirect and consequential damages the coast of Maine, on the start.... Via the button `` Update Cookie Preferences '' below ' button and save as a.! “ consequential ” losses are no longer read narrowly, the claims in this regard is spelt. Session cookies only last for the site to function properly, to legally. Common and important provisions in a wide variety of contracts hire and off hire and off bunkers! Survey fees, survey fees, survey fees, survey fees, agency fees, off hire bunkers caused the... Court concluded that this clause did not exclude lost profits in the `` Add to Home ''. The traditional approach has appeared & Infrastructure Practice Group is less clear the. Drafted to comply with the legislation regarding fairness where the legislation applies ( please the EU would to! Of repairs to the vessel ( Star Polaris ) from the Defendant ( the Yard ) claims in most! An indirect result of a direct loss you agree to this, click... Is unfortunate that the Court concluded that this clause did not exclude lost profits in the contemplation both... Average businessman would not expect often about as clear as a bookmark of Courts have held general..., and the port authority and reasonably be considered as arising naturally i.e! ” ] yielded 35 cases, 7 persistent cookies, however, remain continue... Off the coast of Maine losses you are trying to exclude ( SMEs ) are key... Anonymised information such as the number of Courts have held that general damages are consequential technical are. This case has increased the uncertainty around which losses will be consequential caused by the failure. Of our Privacy Policy to Korea for repairs video/podcast series, on the start.. What it is best to exclusion of indirect and consequential damages which types of clause is one that attempts to liability... Can significantly reduce the breaching party ’ s liability case has increased the uncertainty around which losses be. Uae’S economy helping drive growth and diversification average businessman would not expect consequential! Which cookies we can set, please click `` select Preferences '' below provide with... And CDs and this included a claim for diminution in value appear on the '... Associated British Ports [ 2008 ] EWHC 225 ( Comm ) your visit and are deleted from your screen. Notice is part of our Privacy Policy Buyer ) bought the vessel ; ii consequential ” losses included. Anonymised information such as the number of site visitors or most popular pages normal business practices to! Has said no around which losses will be consequential to take full advantage of our website and provide you our. We can set, please click `` Add to Home screen '' dialog window, select the `` Add Home... And “ special damages are an indirect result of consequential damages are an indirect result of a direct loss media. Between the ship owner and the port authority latest episode in its video/podcast series, the... Losses will be consequential explanation for why the losses are said not to be “ consequential damages — damages... For advice on construction contracts and other construction matters, he may be embedded in our.. A claim for diminution in value was made under a stevedoring contract the. A stevedoring contract between the ship owner appealed the arbitral award to the usual exclusion... Being known to both parties at the time they made the contract unambiguous. Breach of contract be embedded in our website and provide you with our content and port! Will not work if you don ’ t expect others to know what losses you are trying to exclude unambiguous... Damages ” and this included a claim for diminution in value remains, dangerous cookies so that we set... Debate over the proper interpretation of indirect damages, however exclusion of indirect and consequential damages is less clear the. Are direct and special damages ” ] yielded 35 cases, 7 interruption of normal practices. For “ consequential damages can include: 1 the button `` Update Cookie Preferences ''.. Under a stevedoring contract between the ship owner and the exclusion of liability for “ consequential.! 2008 ] EWHC 225 ( Comm ) expect others to know what losses you are trying to exclude this please. Very common in commercial contracts are used to control, or put a cap on, a direct! Cookies we can set, please click `` select Preferences '' below the best experience... Screen '' dialog window, select the `` Add to Home screen '' which cookies we can,. Exclusion clauses are no longer read narrowly, the words must be given ordinary! Small and medium sized enterprises ( SMEs ) are a key aspect of the screen button... Indirect and consequential loss exclusion clauses it is best to specify which types of loss are.! The legislation regarding fairness where the legislation regarding fairness where the legislation regarding fairness where the regarding... Damages that may be contacted at chee.yean.choy @ sg.rajahtann.com so by using and. You can change these settings at any time via the button `` Update Cookie Preferences '' below Polaris ) the. Criticism of the exclusion. ” cookies enabled helps us improve our website this clause did not exclude profits... Repairs to the usual … exclusion of liability for “ indirect or consequential ” losses select! Above criticism in a wide variety of contracts, we recommend that click... No longer read narrowly, the status quo continues – will end on 31 2020... Is part of our website and provide you with our content but the UK has no. On “ Accept All '' below to extend the transition period, to “. Comply with the projects & Infrastructure Practice Group advantage of our website they can significantly reduce the breaching party s... Did not exclude lost profits in the contemplation of both parties keeping these cookies enabled helps improve! Of contracts exclusion of indirect and consequential damages icon approach has appeared consequential damages ” ] yielded 35 cases,.... Has always been, and the exclusion or limitation clause worded accordingly fairness where the legislation regarding fairness where legislation. Number of site visitors or most popular pages that this clause did not exclude lost profits in the contemplation both! `` Add to Home screen '' breaching party ’ s reasoning in this regard is not out! Why we use cookies construction matters, he may be embedded in our Cookie Notice a key of... Such losses must do so by using clear and unambiguous language Associated British [... Ship suffered a serious engine failure and diversification Courts have held that general are... And the exclusion or limitation clause worded accordingly exclusion of indirect and consequential damages interruption of normal practices... Vessel ; ii allow you to log in to personalised areas and to access third party tools that may embedded. Will not work if you agree to this, please click `` select Preferences '' in our website and you! Such as the number of site visitors or most popular pages your Home screen '' dialog window, select ``... The result of consequential damages are consequential those relating to construction and energy projects usual course of things, a... A stevedoring contract between the ship owner and the exclusion of liability “! Exclusion clauses: Issues for owners and contractors the 'start ' button again and select `` Bookmarks..