Abacus V. ADT: Importance Of Waivers Of Subrogation

Law360, New York (January 3, 2013, 1:17 PM EST) -- It has long been the general rule in New York that subject to certain statutory exceptions, parties are free to enter into contracts that absolve a party from its own negligence or limit liability to a nominal sum. As a matter of public policy, however, New York law prohibits a party from insulating itself from damages caused by grossly negligent conduct.

Accordingly, exculpatory clauses and liquidated damages clauses in contracts are not enforceable against allegations of gross negligence. However, a party may nonetheless limit liability for...
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