Exclusion and limitation of liability clauses—carve outs for fraud and reasonableness under the Unfair Contract Terms Act 1977 (Innovate Pharmaceuticals Ltd v University of Portsmouth Higher Education Corp)

Table of contents

• What are the practical implications of the case?
• What was the background?
• What did the court decide?
• Case details

Article summary

Commercial analysis: The case involved the construction of a contract between the parties whereby the University of Portsmouth (UoP) agreed to undertake scientific research into the development of a liquid aspirin drug (the Drug) for the treatment of brain cancer. Innovate sought damages of £100m for breach of contract and UoP successfully relied on a clause in the contract limiting its liability to £1 million. The Judge considered the question of exclusion and limitation clauses and fraud rejecting the argument that the clauses in question should not be given effect by reason of the Unfair Contract Terms Act 1977 (UCTA 1977). Written by Lynne Counsell, barrister at Addington Chambers.