Statement lifting obligation or accountability, fully or partially, under specific conditions and eligibility. Varied examples abound. Stated full or partial protection from suit when particular failures occur in executing a contract. Banks state full or partial protection when conducting foreign trade unless negligence is proven. Legal courts dislike these statements and typically apply narrow interpretation or application as reasonable in most circumstances. Refer to exclusion clause, exculpatory clause, and indemnity clause.

More On This Topic

Link to This Definition
Did you find this definition of EXEMPTION CLAUSE helpful? You can share it by copying the code below and adding it to your blog or web page.
Written and fact checked by The Law Dictionary