Business Law Essay Example | Topics and Well Written Essays - 500 words - 16

Business Law - Essay Example One such case referred in the article was decided in 1991 at California in which a developer named Mark Borough California, Inc. litigated against consulting engineers. These engineers designed an artificial lake but its liner failed and therefore a $5 million amount was claimed against the engineers. So the engineers took the position that the contractual agreement involved the limitation of liability clause that restricted their liability to their fee earned on the project i.e., $67,640 and the trial court accorded with the engineers. Succeeding cases endorsing ‘LOL’ include Valhal Corp. v. Sullivan Associates, Inc., Union Oil Company of California v. John Brown E&C,., and R1 Associates, Inc., v. Goldberg-Zoino & Associates, Inc. Although such cases also exist where the claim was overturned by the court, for instance Ricciardi v. Frank. This case was settled in New York city in which a house owner litigated for the failure in problem identification in the water encroac hment in the basement. The LOL clause constrained the liability of engineers in this case to only an amount of $375 but in this case the clause was ruled to be as invalid as it didn’t entailed the option for the house owner to buy complete protection and the clause was provided in the inspection report after the inspection had been done (Fishman, 2011). The article provided the ways to increase the chances of enforcement of this clause. It has been presented that if the clause has been inserted into by parties having equal strength to bargain, and its drafting has been clarified, it will lead to enforcement unless the state law contrary to this clause exist or it has been decided that the clause enforcement had been unconscionable. The article recommends negotiation of the LOL clause among the two parties. The limitation offered on the liability should be equitable. The article offered