Exclusion Clause vs Limitation Clause

Exclusion Clause vs Limitation Clause

Exclusion clauses and limitation clauses are both types of contractual provisions that aim to allocate risk and define the extent of liability in a contract. However, they have distinct differences in their nature and effect.

Exclusion Clauses

Purpose: An exclusion clause is a contractual provision that seeks to exclude or eliminate liability for specific types of losses, damages, or obligations. Its primary function is to absolve a party from liability altogether for the specified circumstances.

Scope: An exclusion clause operates by stating that one party will not be liable or responsible for certain specified events, risks, or situations. It seeks to entirely remove or "exclude" the possibility of a claim or legal action arising from those circumstances.

Effect: An exclusion clause aims to deny any right or remedy that the non-excluding party may have against the party seeking to rely on the clause. If valid and enforceable, it can absolve the party from any legal obligation or liability associated with the specified events or circumstances.

Limitation Clauses

Purpose: A limitation clause, on the other hand, is a contractual provision that seeks to limit the amount of liability that a party may be responsible for in case of a breach or specified events. It sets a maximum limit or cap on the damages or losses that can be claimed.

Scope: A limitation clause typically applies to specified types of losses, damages, or obligations. It does not seek to exclude liability entirely but rather restricts or "limits" the amount of liability that can be claimed, even if a breach or specified event occurs.

Effect: A valid and enforceable limitation clause caps the amount of damages or losses that can be recovered by the non-limiting party. It does not absolve the party entirely but rather sets a threshold beyond which the party's liability cannot exceed.

In summary, exclusion clauses aim to exclude or eliminate liability entirely for specific circumstances, while limitation clauses seek to limit the amount of liability that can be claimed. Exclusion clauses remove the possibility of a claim, while limitation clauses establish a cap on the amount of damages that can be recovered.
Back to blog
UOL Case Bank

UOL Case Bank

Upon joining, you become a valuable UOL student and gain instant access to over 2,100 case summaries. UOL Case Bank is constantly expanding. Speed up your revision with us now.

Subscribe Now

Where are our students from?

Yale University
Council of Europe
Baker Mckenzie 
University of Chicago
Columbia University
New York University
University of Michigan 
University College London (UCL)
London School of Economics (LSE)
King’s College London (KCL)
University of London
University of Manchester
University of Zurich
University of York
Brandeis University
University of Exeter
University of Sheffield
Boston University
University of Washington
University of Leeds
University of Law
Royal Holloway, University of London 
Birkbeck, University of London
SOAS, University of London
University of Kent
University of Hull
Queen’s University Belfast
Toronto Metropolitan University
Hong Kong University of Science and Technology
University of Buckingham

  • Criminal Practice

    Diagrams and Charts

    Our carefully designed diagrams and charts will guide you through complex legal issues.

  • Criminal Law

    Clear and Succinct Definitions

    Key concepts are concisely defined to help you understand legal topics quickly.

  • Property Law

    Statutory Provisions

    Statutory provisions are provided side by side with legal concepts to help you swiftly locate the relevant legislation.

  • Public Law

    Case Summaries

    We have summarised important cases for you so that you don't need to read long and boring cases.

  • Evidence

    Rules and Exceptions

    Rules and exceptions are clearly listed so that you know when a rule applies and when it doesn't.

  • Company Law


    Legal terms and key concepts are explained at the beginning of each chapter to help you learn efficiently.

  • Case Law

    Case law is provided side by side with legal concepts so that you know how legal principles and precedents were established.

  • Law Exam Guide

    Law Essay Guide

    You will learn essential law exam skills and essay writing techniques that are not taught in class.

  • Law Exam Guide

    Problem Question Guide

    We will show you how to answer problem questions step by step to achieve first-class results.

  • Conflict of Laws

    Structured Explanations

    Complex legal concepts are broken down into concise and digestible bullet point explanations.

  • Legal System and Method

    Legal Research

    You will learn legal research techniques with our study guide and become a proficient legal researcher.

  • Jurisprudence and Legal Theory


    All essential concepts, principles, and case law are included so that you can answer exam questions quickly.