Limitation of Liability. These provisions permit one or both parties to place certain limitations on their liability for breaking the agreement of the parties. Properly written, Limitation of Liability provisions can cap a party's legal exposure for certain conduct.
Attorneys' Fees and Costs. In the American judicial system, a party is generally required to pay his or her own legal fees and expenses, win or lose. However, parties to a contract may, with certain limitations, require that a party who loses in a legal action bought due to the agreement pay the attorneys' fees and costs incurred by the prevailing party.
This article first appeared in "Common Issues Faced by E-Commerce Businesses," a seven-part series appearing each Tuesday afternoon on the author's E-Commerce Law blog. Readers are reminded that all of the information in this article is provided for informational purposes only and is not intended to be a substitute for legal counsel. No one should act or refrain from acting on the basis of any content included on this site but should instead seek the appropriate legal advice on the particular facts and circumstances at issue from a properly licensed attorney.