Courts have used concepts like foreseeability, natural result of the breach, and collateral business in their attempts to define the boundary. As the recent Dow Chemical Canada ULC v. by Arch Fletcher. Consequential loss exclusion clauses: Issues for owners and contractors. Those categories, I argue, are not particularly helpful. Consequential damages is one of those U.S. legal concepts that all lawyers learn about in law school, but nonetheless generates confusion and disagreement in … You can rely […] Contracts often include language excluding compensation for consequential damages. Exclusion and limitation of liability clauses often exclude “lost profits” from the types of consequential damages that are recoverable. But, will this type of clause always work to exclude recovery of any type of lost profit? However, the boundary between consequential and direct damages is a blurry one. Once again the interpretation of exclusion clauses limiting liability for “consequential losses” has come before the courts. I have in front of me a contract—it’s for the sale of goods—that contains the following provision excluding certain kinds of damages: Neither party will be responsible or held liable for any consequential, special, or incidental losses or damages. He received a B.A. from Oberlin College and an M.A. However, in this case, the parties were of equal bargaining power and the Court held that the mutual indemnities which extended to consequential losses should stand. Victor P. Goldberg is the Jerome L. Greene Professor of Transactional Law at Columbia Law School. Consequential Damages Exclusions. 29 Pages Posted: 16 Mar 2018 Last revised: ... the seller would be liable for the difference — the consequential damage exclusion would not apply; however, some claims for breach of warranty would be for consequential damages. Clauses that seek to exclude a party's right to damages are often subject to restrictive interpretation by the courts. Consequential loss exclusion clause fails to shut out damages in IT system dispute Print Twitter LinkedIn The High Court decision in GB Gas v Accenture illustrates once again that under English law an exclusion of liability for indirect or consequential loss often has little practical effect. [For a follow-up to this post, see this March 2, 2010 blog post.] Victor P. Goldberg, Consequential Damages and Exclusion Clauses, 3 Criterion J. on Innovation 27 (2018). Consequential Damages and Exclusion Clauses. This article examines consequential damage exclusion trends in private company M&A transactions. Columbia Law and Economics Working Paper No. “The exclusion is "for any indirect or consequential loss or damage". 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. For example, the exclusion of liability clause in ENAA 1996 (GC 30.2) refers to “any indirect, special or consequential loss or damage”. 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 High Court’s decision in Star Polaris LLC v HHIC-PHIL INC is an interesting reminder of the debate surrounding exclusion clauses and the interpretation of “consequential loss”. and Ph.D. in economics from Yale University. 582. Similarly, the exclusion of liability clause in the FIDIC Silver Book (Sub Clause 15 Sep 2004. 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