03 / A possible explanation
Illustrative mock-up
Illustrative mock-up, not real output
Sample clause
Self-drafted
Limitation of liability
The Supplier’s total liability arising out of or in connection with this agreement shall not exceed the fees paid by the Customer in the three months before the event giving rise to the claim. This limit applies to claims relating to loss of data, confidentiality breaches and interruption of the service.
Fictional wording, written only for this illustration.
Mock output
Illustrative risk: high
In plain English
This wording aims to cap the supplier’s liability at three months of fees. It also applies that cap to data loss, confidentiality breaches and service interruptions.
Why this risk level?
A short fee period could produce a low cap, even where data loss or a confidentiality breach causes a much larger loss.
What it could not assess
The rest of the agreement, any exceptions, the fees paid, the possible losses, the governing law or whether the cap is enforceable.
This clause alone cannot establish whether the cap is suitable or legally enforceable.