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15 May 2012 · Article

Consequential Loss - What Is It?

Consequential loss clauses are notoriously difficult in negotiations. Over many years in commercial roles, local and global, legal, contracting and procurement, I have encountered people misunderstanding the risks of using incorrect wording, or misunderstanding both the intent and technical drafting requirements for what, in the vernacular, are called 'consequential loss clauses.'\r
Although it is quite easy to train commercial, contracts, procurement and sales people in avoiding the pitfalls, I see too many examples of poor drafting leading to eye watering liabilities not contemplated by the liable party.\r
By C. Haward Soper, LL.B, MPhil, MCIArb, FCIPS, Shell

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