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What Is Limitation of Liability?
A limitation of liability clause caps the total amount one party can be required to pay the other under a contract, often set to the fee, the available insurance, or an agreed dollar amount. For design professionals it is one of the most valuable protections to negotiate, especially when the fee is small relative to the project.
Ontario courts generally enforce clearly worded limitation of liability clauses between commercial parties, provided they are unambiguous and do not try to exclude fraud or wilful misconduct. It pairs well with a mutual waiver of consequential damages. More in our engineering contract review guide.
Questions about Limitation of Liability?
Our Ontario brokers can explain how it applies to your policy.
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Reviewed by Roughley Insurance Brokers Ltd. — licensed Ontario insurance brokers since 1945. Last updated June 21, 2026. ← Back to the glossary