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25 February 2016 / Chris Nillesen
Issue: 7688 / Categories: Features , Commercial
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Capping the well

A cap on liability can lead to some serious sparring with clients, as Chris Nillesen reports

The recent case of Elevantine Full Circle Ltd v Amex Earth & Environmental (UK) Ltd [2013] EWHC 1191 (TCC) (Elevantine) concerned a dispute where the claimant sought £790K worth of damages for breach of contract. The defendant challenged the claim on a number of grounds, including the existence of a contractual clause limiting the total liability of the defendant to £14K.

The court ruled in favour of the defendant on other grounds and therefore did not need to examine the validity of the limitation clause, however the judge did state, obiter dicta , that if necessary he would have upheld the £14K contractual liability cap as a fair and reasonable clause. By contrast in Saint Gobain Building Distribution Ltd (t/a International Decorative Surfaces) v Hillmead Joinery (Swindon) Ltd [2015] EWHC B7 (TCC) (Gobain) the courts held a clause capping all liability in standard terms to be unreasonable.

The effectiveness of clauses capping liability

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MOVERS & SHAKERS

Signature Litigation—Catherine Naylor

Signature Litigation—Catherine Naylor

International fraud and asset recovery offering boosted by partner hire

Stevens & Bolton—Alexa Payet

Stevens & Bolton—Alexa Payet

Private wealth disputes team adds contentious probate specialist

Morgan Lewis—Paul Feldberg

Morgan Lewis—Paul Feldberg

Firm strengthens investigations and sanctions capabilities with London partner hire

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Cheshire West, which established an ‘acid test’ for deprivation of liberty safeguards, has been overturned by the Supreme Court
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Law firms that hold client money will need to file annual accountants’ reports and make a declaration, the Solicitors Regulation Authority (SRA) confirmed this week
Two district judges and a tribunal judge have been sanctioned for delays in delivering judgments and orders
Private equity (PE) investment into UK law firms halved to £250m last year, but deal volume rose, according to research by Acquira Professional Services’ Momentum private equity market tracker
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