What is an exculpatory clause?

An exculpatory clause (also known as an “exculpatory agreement” or “exculpatory language”) is a clause found in contracts, particularly those that involve services of a hazardous nature, that is designed to release one of the parties from legal liability in case of an injury or accident. In California, exculpatory clauses are generally enforceable, as long as they meet certain criteria. The clause must be written in plain language, without any hidden meanings or wording, and the agreement must be fairly and voluntarily made by the parties involved. If any of the parties is a minor or mentally incapacitated and cannot clearly understand the language in the agreement, the clause is not valid. Similarly, if the clause was not part of the original contract or was added at a later date, it will not be binding. Further, the clause must be reasonable and limited in scope—it cannot be used to absolve one party from all liability, no matter how severe the incident. In California, exculpatory clauses are meant to protect both parties, though they usually favor the party who proposed the language. In cases of injury, the party injured can still sue the other party for damages, but the clause will retain its strength in the court of law. Ultimately, exculpatory clauses are a useful tool for parties involved in a contract to mitigate the potential risks of engaging in hazardous activities. Still, it is best for parties to read and understand the language of the wording in an agreement before signing to make sure that the clause is valid and fair for both sides.

Related FAQs

What is acceptance of a contract?
What is a merger clause?
What is the effect of a modification of a contract?
What is equitable relief?
What is a durable power of attorney?
What is a declaratory judgment?
What is the law of privity?
What is a warranty in a contract?
What is the effect of a novation of a contract?
What is the termination of a contract?

What is an exculpatory clause?

Related FAQs

Related Blog Posts