Do exclusion or limitation of liability clauses apply to cases of deliberate repudiatory breach, ask Ceri Morgan & Melanie Shefford
For the last two years, there has been widespread concern among legal practitioners that contractual clauses excluding or limiting liability (unless clearly drafted) may not operate where there has been a deliberate repudiatory breach of that contract by one of the parties. These concerns arose following the High Court decision in Internet Broadcasting Corporation v MAR LLC (Marhedge) [2009] EWHC 844 (Ch), [2010] 1 All ER (Comm) 112 (NetTV), in which Mr Moss QC, sitting as a High Court judge held that there was a rebuttable presumption that an exclusion clause should not apply to a deliberate personal repudiatory breach of contract.
However, the NetTV decision has recently been subject to scrutiny by Mr Justice Flaux in the case of AstraZeneca UK Limited v Albemarle International Corporation and Albemarle Corporation [2011] EWHC 1574. Flaux J concluded in obiter dicta that no such presumption existed and any question of limitation of liability should simply be one of construing the clause.
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