- Contract — Exclusion or limit of liability
An exclusion clause might operate in any of the following three ways: (a) as a limitation clause, imposing a financial cap on the compensation to be paid upon breach; or (b) it might provide for total exclusion of liability for breach; or (c) the clause might constitute a time restriction (an agreed time bar), which requires a claim to be made within a specified period of the alleged harm, that period being shorter than the ordinary limitation period prescribed by statute (ordinarily, six years for breach of contract, twelve years if the action is based on a deed). By a combination of judicial doctrine and (predominantly) statutory regulation, exclusion clauses have become more closely controlled since the Second World War. This chapter explains these responses to this problem.
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