I have drafted many Terms and Conditions of Business over the years and in my experience the most important clauses are those that deal with questions relating to liability and what will happen if something goes wrong.
I will always ask my client when preparing these business terms, what losses are likely to be incurred if something goes wrong. In my experience, it is generally not wise to incorporate a clause which simply says that you will not be responsible for anything.
If you wish to exclude certain types of loss from your contract then you should work out what are the matters you should be most concerned about. Should you be concerned about direct loss e.g. if you are delivering goods from A to B and the goods are lost or damaged or stolen on route then this can be specifically covered. If the loss however is likely to be negligence e.g. professional negligence, then specific reference should be made to this fact.
I also advise clients to assume that whatever exclusion clause they try to incorporate may not be binding and in these circumstances an overall cap on liability should be included.
I have seen Terms and Conditions of Business written in tiny print on the back of an invoice and hidden away in clause 34 are critical exclusion clauses, which in certain cases should be specifically brought to the attention of the other party and which are not.
The aim of Terms and Condition of Business is to try and resolve differences without having to go to court and very careful consideration should be given to the drafting of these clauses if the aim is to exclude liability or even if the aim is to simply limit the extent of liability. Sweeping clauses attempting to exclude liability for everything, no matter how it arises can create as many problems as they resolve.
Think carefully about what is likely to go wrong and you can then instruct your solicitor properly and terms and conditions can be prepared which will hopefully protect you in the event that something goes wrong.
Kevin Brophy
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