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Can you exclude your liability?


We are all aware of exclusion clauses that appear on invoices, tickets, agreements and noticeboards.  The purpose of these exclusion clauses is to exclude any liability on the part of the provider of the services and/or premises.  The question remains whether these clauses offer adequate protection from liability for damages.

In a recent case (La Rosa v Nudrill Pty Ltd) such an exclusion clause did not provide any protection to the supplier of the services and the supplier was held liable for damages.

Mr La Rosa was contracted by Nudrill to transport a drill rig on the back of his semitrailer from Perth to Kalgoorlie.  What happened next was that the drill tipped off the back of the trailer and was severely damaged.  Nudrill sued Mr La Rosa for damages alleging Mr La Rosa drove negligently and his negligence caused the drill to fall from the trailer.

Mr La Rosa’s defence was based on an exclusion clause which appears on the back of his invoice stating he will not be liable for any damages caused even by his own negligence.

The question posed by the court to Mr La Rosa’s legal team was to show how the exclusion clause became legally binding between the parties.  Mr La Rosa’s team relied on a long standing relationship between the parties well before the incident, that all previous invoices contained the same exclusion clauses, that Nudrill was aware of the exclusion clauses and despite that fact, Nudrill still continued to use Mr La Rosa for transporting services.

Despite all these arguments by Mr La Rosa’s legal team, the court found that there must be evidence to demonstrate that the exclusion clause was known to and accepted by Nudrill before or during the time that the contract to render the services was entered into.  An invoice which was sent after the services were delivered requesting payment for the services cannot constitute contractual terms of a contract.

By receiving the invoice, there was no proof that Nudrill accepted the terms of the exclusion clause.  The contract was completed and it was too late for Nudrill to either accept or refuse the exclusion clause.

It would have been different if the existence of the execution clause was specifically brought to the attention of Nudrill before the services were performed and the terms of the services were agreed upon.

It is therefore important to ensure that if you use exclusion clauses you have evidence available that the existence of these clauses were made known to the other parties and that they have accepted it.

If you would like more information or want to obtain the best possible chance of a successful outcome in your dispute, please contact our Commercial Litigation Department Manager, Amanda Heather on direct line 07 5506 8245, email or free call 1800 621 071.

We have an experienced dedicated Commercial Litigation team that practice exclusively in these areas.

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Charles Lethbridge - Partner - Commercial Litigation

Charles Lethbridge

Commercial Litigation

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The contents of this article are considered accurate as at the date of publication. The information contained in this article does not constitute legal advice and is of a general nature only. Readers should seek legal advice about their specific circumstances. 

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