Hey, F. Lee!

Good to hear from you again!  There were a couple of recent cases dealing with this issue, one of which I believe was reported here on Source of Title.

In Express Financial Services v. Gateway Abstract, Inc., (Monroe County, PA, 2004), the court held that an abstract company’s liability is limited to amount of the fee, even where that limit appears only on the abstract comany's invoice, and there is no pre-existing agreement between the parties.

Furthermore, in Puget Sound Financial, LLC v. Unisearch, Inc., (2006), the Supreme Court of Washington State unanimously upheld the validity of language printed on a UCC search company's invoice which limited the search company's liability to the cost of the search, in this case, $25.00.

In the Unisearch case, the court's decision was based on a three-pronged rationale, 1) that trade usage and course of dealing are "appropriate evidentiary doctrines for determining the terms of a non- or partially integrated agreement, including one that began as an oral contract", 2) a liability limitation between commercial parties with a history of trade usage or course of dealing is not unconscionable, and 3) that even in the absence of a history of trade usage or dealing, such a term is not unconscionable if the exclusionary language is conspicuous and both parties have a chance to review it.

What I found most interesting about this case is that by using the term "conspicuous", the Court did not require that the liability limitation "stand out", but that the language be treated comparably to other terms of the agreement.  As a practical matter, the issue would then become whether or not the language is "buried in the fine print"; or, whether or not the limitation language is as conspicuous as other terms in the rest of the contract.

Speaking of disclaimers, to anyone else reading this, I am not a lawyer, nor do I play one on TV.  I am simply having a discussion with my good buddy, F. Lee Ahern, so don't rely on any of the above as legal advice.  Get a lawyer.

Regards,
Scott Perry