The purpose of a contract is four-fold, with the first two being the most significant:
- Ensuring you get paid
- Allocating risk between the parties
- Setting forth the expectations of the parties
- Setting forth critical processes and protocols for: getting paid, addressing disputes, modifying the terms.
Here are some sample contract provisions to limit your liability.
The first provision simply limits the types of damages your client can claim when they sue you:
Client agrees that Company shall not be liable to Client or any third party for any loss of profits, loss of use, interruption of business, or any direct, indirect, incidental or consequential damages of any kind whether under this Agreement or otherwise, even if Company was advised of the possibility of such damages.
This next provision just sets forth a cap on the damages the client can seek against you if they sue you:
Client agrees that Company’s liability under this Agreement shall be expressly limited to money received by Company pursuant to this Agreement.
This next contract provision is a little more detailed but the idea is basically to limit liability by limiting any specific representations you may make to your client:
The goods and services provided by company are provided AS IS, WITHOUT WARRANTY OF ANY KIND TO CLIENT OR ANY THIRD PARTY, INCLUDING, BUT NOT LIMITED TO, ANY EXPRESS OR IMPLIED WARRANTIES OF: 1) MERCHANTABILITY; 2) FITNESS FOR A PARTICULAR PURPOSE; 3) EFFORT TO ACHIEVE PURPOSE; 4) QUALITY; 5) ACCURACY; 6) NON-INFRINGEMENT; AND 7) TITLE. CLIENT AGREES THAT ANY EFFORTS BY COMPANY TO MODIFY ITS GOODS OR SERVICES SHALL NOT BE DEEMED A WAIVER OF THESE LIMITATIONS, AND THAT ANY WARRANTIES SHALL NOT BE DEEMED TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. MODIFICATIONS MADE TO ANY WORK PRODUCT CREATED BY COMPANY BY CLIENT OR ANY THIRD-PARTY VOIDS ANY REMAINING EXPRESS OR IMPLIED WARRANTIES.
