Exclusion Clause

Introduction What is “Exclusion Clause”? There are various definitions of exclusion clause. Exclusion clause is a term or clause which can be incorporated into a contract. It is a term in a contract that seeks to restrict the rights of the parties to the contract. 1 The terms of the contract are important that they define both the content and scope of the parties’ mutual obligations.2 Classically, terms of the contract have been divided into either conditions or warranties. The development of the innominate term introduces more flexibility approach. Terms have also been classified as express and implied. Basically, exclusion clause is a clause that used to escape contractual liability by relying on a clause or term that excludes liability in certain cases, which is expressly written in a contract. In detail, the most important express term that often found in a contract is a term that exempted or limited the liability of one of the parties who incorporated into the contract is ‘exclusion clause’. 3 It simply means any clauses in a contract or in a notice that giving meaning to ‘exemption’, ‘exception’ or ‘disclaimers’ which have purpose to change any liability, responsibility or possible remedy, else occur from a contractual relationship between parties involved legal effects. These exceptions mainly found in a standardize form of contract especially in the printed conditions such as ticket, bill, receipts and etc. The party receiving it must either accept all printed conditions or refuse it. P.S Atiyah4 observed that an exemption clause may take many forms, but such clauses have one thing in common in that they exempt a party from liability which he would have borne had it not been for the clause. 5 It has been stated that it is common, particularly in standard form of contracts, for one or more parties to seek to exclude or limit liability for breach of contract or misrepresentation, which would otherwise imposed upon him.6

1 2