An Intensive 5-Day Online Training Course

Liability - Excluding and Limiting Contractual Liability

  • Format: Live / Online
  • Duration: 5 days
  • Language: English



This virtual training course is intended to look at the various ways liability can arise under a contractual relationship; how it can be excluded or limited within the contract; and how to allocate the liabilities in a fair and sensible way.

All parties to a contractual relationship wish to limit their exposure to loss, but the truth is that all contracts produce risk, and it is neither reasonable nor sensible that all risk and liabilities rest with one party. By applying the techniques discussed in the course, managers will be better able to ensure that they transfer or accept risks that are appropriate and manageable, but do not place so much risk on a contractor/subcontractor that failure will bankrupt them (in which case the risk flows back to the client/main contractor)

This EuroMaTech virtual training course will help develop the following competencies:

·        Risk identification

·        Risk apportionment

·        Management of the consequences of risk

·        Understanding of external methods of management of liabilities (e.g. insurance, bonds etc.)


This virtual training course will enable participants to achieve the following objectives:

  • Enhanced appreciation of risk and liabilities
  • Techniques for apportioning risk and liability fairly
  • Improved understanding as to how risk is priced, and how that flows through to the economics of a contract
  • Better understanding of the methods for excluding or limiting liability, and when these cannot be used
  • An appreciation of why you should limit your own liability, and why you should expect others to be doing the same



This virtual training course will involve presentation by an experienced practitioner, with knowledge of the issues in a range of industries and on an international basis (especially in the Middle East). The virtual training will include real examples where possible, including actual clauses used in real contracts to show different approaches to the issues. The virtual training course will include opportunities for the participants to raise issues from their own experience for discussion.


This online training course covers a range of essential skills in identifying, allocating and managing risk, and in using the contract or other techniques to exclude or, where this is not possible, limit liability to an acceptable extent. It will also show how the contractual and other provisions should be managed to maximise their effectiveness. 

Day 1: Identifying and allocating risk
  • What is risk?
  • How is it identified?
  • Who should bear the risk, and, if both parties, in what proportions?
  • Who is responsible for the design?
  • How is risk priced?
    • How does the allocation of risk change the cost of a project?
  • What are the consequences if too much (or too little) risk is transferred?
  • What happens if the other party is bankrupted by a liability?
Day 2: Contractual methods for excluding or limiting liability
  • Exclusion clauses
  • Complete or partial exclusion
    • When do these not work?
    • Consequential loss – what it means and why it is commonly excluded
  • Limitation clauses
    • Limiting liability – link with exclusion
    • Limiting cost exposure to a particular subject
  • Liquidated damages – how do you assess these?
    • Overall caps
  • What should be carved out
  • Indemnities
    • They do not alter the risk, merely the consequences
    • They are only as valuable as the party giving them (or their guarantor or insurer)
  • Warranties and guarantees
    • Fitness for purpose
    • Performance
    • Quality of workmanship/services
    • Problems with “design life”
  • What cannot be excluded or limited – problems with different legal systems
    • Negligence/gross negligence/wilful misconduct
  • Do exclusions or limitations also apply to negligence claims?
    • Special issues with maritime law
Day 3: Other methods for managing the effects of risk 
  • Insurance
    • Minimum legal requirements
    • What to cover
    • Who should arrange the policy
    • Co-insured status
    • Waiver of subrogation
  • Bonds
    • Performance
    • Advance Payment
    • Warranty
    • Bank or insurer?
  • Parent Company Guarantees
  • Retentions
  • Payment terms
  • Ownership
    • Retention of title
    • Liens
    • Ownership of goods as they are manufactured
    • Ownership and responsibility for client-supplied equipment or materials
Day 4: Liability for defects and other issues
  • Defects before delivery (re-work)
    • Re-testing
    • Additional testing
  • Defects after delivery (warranty/defects correction)
    • Period of liability
    • Limitations on scope
    • Exclusions (use outside scope, accidental damage, fair wear and tear etc.)
    • Decennial liability (where applicable)
    • Latent defects
  • Force Majeure
    • Excludes liability for time, but not usually for cost
Day 5: Managing exclusions and limitations
  • Ensure all relevant staff know what is (and is not) covered
  • Monitor risk through an agreed risk register
    • Be realistic
    • Review and adjust the register regularly as the project progresses
    • Release contingency as risks pass
  • Keep good records
  • Serve notices when needed
    • And use the correct method for service
  • Prepare a Lessons Learned report at the end of each project
    • (And do something with it!)
  • Final review and wrap-up





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