The question becomes whether the arbitration clause stands to "significantly affect the result of a litigation" in the sense of operating as an
exculpatory clause.
If a trustee or trustee's firm assisted the settlor or testator in drafting the document and the
exculpatory clause, a court may rule that the trustee drafted the clause to protect himself, thus breaching his fiduciary duty.
When challenging a ban either on an unconscionability theory or based on a state's public policy against adhesive
exculpatory clauses, it is best to have a strong factual record.
nonobligation by reason of the
exculpatory clause is equivalent to the
Exculpatory clauses may limit the trustee's liability for certain failures.
All of the general engagement letter contents, the
exculpatory clause and possibly the clarifying language clause regarding third-party users mentioned earlier should be included therein.
The beneficiaries would rather accept a gift with the
exculpatory clause than receive no gift whatsoever.
In most states, if a contract of adhesion (meaning a "take-it-or-leave-it" contract drafted by the more powerful party) would serve as an
exculpatory clause (meaning a contract term that would deny the weaker party any effective means of vindicating its legal rights), then the contract (or at least the term that renders it exculpatory) is unconscionable.
Superior Court (Boer) held that a class-action waiver clause in a consumer contract was unconscionable because it worked like an
exculpatory clause and would ensure that the bank would never have to account to its customers for the typical claim involving small amounts.
11) It is noteworthy that public policy considerations will defeat an
exculpatory clause if doing so would frustrate a statute or ordinance that has the very purpose of insuring the safety of persons.
An
exculpatory clause providing that the landlord is not liable for property damage from falling water, leaking from pipes or plumbing unless caused by landlord's negligence, nor for any such damage caused by other tenants, is also void as contrary to public policy.
Cingular Wireless, LLC, have addressed this issue head-on, calling a class-action ban by its rightful name: an
exculpatory clause that unfairly favors one party to the agreement.
