ARCHIVED: This archived Practice Note sets out the usual data protection liability positions reached in general business services agreements between controllers and processors in the UK market based on responses to a survey carried out by LexisNexis® in 2020 from experts at several leading firms. It reflects market practice as surveyed in 2020 and is not maintained; it is for background information only. It covers: • the purpose of the survey and how to use this Practice Note • the controller’s liability for breaches of its data protection obligations • the processor’s liability for breaches of its data protection obligations • indemnities • details of what aspects of the negotiations usually take the most time It is common practice for a controller to engage a processor to process personal data on its behalf, commonly where one organisation provides a service to the controller and processes personal data on its behalf in the course of providing that service. Therefore a customer

This Practice Note provides high-level guidance for in-house lawyers on exclusion and limitation of liability. Exclusion and limitation of liability Exclusion and limitation of liability clauses offer in-house lawyers an opportunity to manage their organisation’s contractual risks. Such clauses are heavily negotiated in most contracts and in the spotlight if things go wrong. The legislation which regulates clauses of this type is complex and the law impacting their interpretation is nuanced. An in-depth understanding of the background law is essential when negotiating exclusion and limitation of liability clauses. Clear and precise drafting is also key to a strong exclusion and limitation of liability clause. Business-to-business (B2B) contracts A contract term which excludes or limits liability is subject to statutory and common law controls. Practice Note: Exclusion and limitation of liability considers exclusion and limitation of liability in business-to-business (B2B) contracts. It provides guidance on the common law and statutory controls affecting exclusion and limitation of liability clauses (also known as limitation of liability clauses, limitation clauses, exclusion of liability clauses, exclusion clauses and

Commercial analysis: In a claim in connection with the provision of software services the court decided preliminary issues in respect of a limitation of liability provision. The issues were whether a cap on the amount payable by the supplier of the services to a customer was a single aggregate cap or multiple caps with a separate financial limit applying to each of the claimant’s claims and, if there were multiple caps, which were the claims to which the cap applies? The court decided that the limitation of liability did not involve multiple caps. The case is important because many commercial contracts (and consumer contracts) have limitation of liability clauses and the interpretation provided by the court will be relevant to those drafting such contracts. Written by Fred Philpott, barrister at Gough Square Chambers.

It covers the following: • Legal principles • Approaches in outsourcing • Heads of losses • Specific provisions in the agreement • Dealing with data protection liabilities • General considerations For detailed guidance on the exclusion and limitation of liability in commercial contracts generally, see Practice Note: Exclusion and limitation of liability, and for practical negotiating and drafting guidance, see: Drafting and negotiating a limitation of liability clause—checklist. For an example limitation of liability clause, see Precedent: Limitation of liability clause. Legal principles A contract term which excludes or limits liability is subject to both statutory and common law controls, with the majority of the key statutory restrictions found in the Unfair Contract Terms Act 1977 (UCTA 1977). The courts are, however, generally reluctant to interfere with commercial deals struck between sophisticated businesses. Some concern arose among suppliers following a number of IT cases in the 1990s in which the courts took a heavily interventionist approach to construction and found many clauses to be unreasonable. This trend did not continue, and in later cases such as Watford

1 Limitation of liability 1.1 The extent of the parties’ liability under or in connection with this Agreement (regardless of whether such liability arises in tort, contract or in any other way and whether or not caused by negligence or misrepresentation) shall be as set out in this clause 1. 1.2 Subject to clauses[ 1.6,] 1.7 and 1.8, the total liability of: 1.2.1 the Supplier shall not exceed the sum of £[insert]; 1.2.2 the Customer shall not exceed the sum of £[insert]. 1.3 Subject to clauses 1.5,[ 1.6,] 1.7 and 1.8, neither party shall be liable for any consequential, indirect or special losses. 1.4 Subject

These Training Materials provide an introduction to exemption clauses and cover the basic areas of relevance for commercial lawyers when drafting and reviewing clauses excluding and limiting liability. They include template PowerPoint slides and associated notes for use by a trainer when outlining the law relating to the limitation of liability in the context of the drafting and negotiating of business-to-business contracts by commercial lawyers. Topics covered include: exemption clauses, construction, types of breach, types of loss, statutory controls under the Unfair Contract Terms Act 1977 and the Misrepresentation Act 1967, methods of excluding and limiting liability, third parties and frequently asked questions. At the end of each section of the presentation there is a ‘Top tips’ slide and speaker notes which provide practical suggestions and recaps on the

Limitation of trustees’ liability—lease clauses Trustees means the persons named as [ Landlord OR Tenant] in this lease and any person appointed as trustee of [name of trust or charity] from time to time. 1 The liability of the Trustees for the time being in respect of any breach by the [Landlord OR Tenant] of any of the [Landlord’s OR Tenant’s] obligations under this lease is limited in amount to the

Financial cap 1 The Consultant's liability under or in connection with this Appointment shall not exceed a maximum amount of £[insert] million for each and every claim, other than for claims in respect of fraud, death

The time period during which court action must begin.

Dispute Resolution analysis: The Court of Appeal has rejected 40 years of ‘received wisdom’ among company law practitioners and has held that a limitation period of either twelve or six years (depending upon the relief sought) applies in respect of petitions under section 994 of the Companies Act 2006 (CA 2006). Written by Phillip Patterson, barrister, Gatehouse Chambers.

1 [No action or proceedings for any breach of this Agreement

TMT analysis: Applying the rule in Dingle, evidence of other publications harmful to a claimant’s reputation is not admissible either on the question of serious harm under section 1 of the Defamation Act 2013 (DA 2013) or mitigation of damages. The judgment also considers the disapplication of the one-year limitation period to bring a defamation claim. In the unique circumstances of this case, the claimant was permitted to amend his claim form to include publications outside the limitation period. Written by Michael Frost, managing associate and Joshua Edwards, associate at Mishcon de Reya LLP.