B2B limitation and exclusion of liability clauses: drafting and negotiation checklist covering financial caps, loss categories, indemnities, and UCTA reasonableness/Misrepresentation Act controls

Published by a LexisNexis Commercial expert

Checklists

This Checklist outlines the principal matters to weigh up when preparing and negotiating a limitation of liability clause in a business-to-business (B2B) contract. It offers practical direction on negotiating and drafting these provisions-sometimes referred to as limitation clauses, exclusion of liability clauses, exclusion clauses or exemption clauses-in a commercial agreement, and reviews the effect of common law and statutory controls, including the Unfair Contract Terms Act 1977 (UCTA 1977) and the Misrepresentation Act 1967 (MA 1967). It addresses:

General drafting points for limitation of liability clauses
Key issues to evaluate
Party-specific considerations
Setting financial caps
A summary of the principal common law and statutory controls
Alternative methods to limit or exclude liability

For a precedent limitation of liability clause with comprehensive drafting notes, see Precedent: Limitation of liability clause. For broader guidance on exclusion and limitation of liability, see Practice Note: Exclusion and limitation of liability. For a practical ‘how to’ on reviewing an exclusion and limitation of liability clause in commercial B2B agreements that signposts relevant content, see Practice Note: How to review an exclusion and limitation of liability clause.

General drafting points for limitation of liability

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Web page updated on 26/05/2026

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