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Indirect Damages Waiver

CSA 3.0 Standard Terms Section 8.2: what the Indirect Damages Waiver excludes, its exceptions, and how it differs from the v2 Damages Waiver

Written by Mark Frantz

This article covers version 3.0 of the Cloud Service Agreement. The Indirect Damages Waiver was called the Damages Waiver in earlier versions. Learn more about agreement versions.

The Indirect Damages Waiver is Section 8.2 of the Cloud Service Agreement Standard Terms. It isn't a Cover Page variable, so there's nothing to fill out, but it shapes what either party can recover.

What it waives

Neither party is liable to the other for:

  • Lost profits or revenues, whether direct or indirect

  • Consequential, special, indirect, exemplary, punitive, or incidental damages relating to the agreement

This applies even if a party was told in advance that this kind of damage was possible.

Exceptions

The waiver doesn't apply to:

  • A breach of Section 10 (Confidentiality)

  • Anything the Cover Page provides otherwise

  • Liability that Applicable Laws don't allow a party to limit (Section 8.4)

  • A party's gross negligence, willful misconduct, or fraud (Section 8.4)

Selecting a claim as an Increased Claim or an Uncapped Claim changes which liability cap applies to it. It doesn't, by itself, take that claim out of the Indirect Damages Waiver.

To change how the waiver applies in a specific agreement, add your change under Other Changes to the Standard Terms on the Cover Page.

What changed from version 2.x

  • The section was renamed from Damages Waiver to Indirect Damages Waiver.

  • In version 2.x, the waiver didn't apply to Increased Claims. In version 3.0, Increased Claims are no longer automatically excluded.

  • Version 3.0 adds the rule in Section 8.4 that liability for gross negligence, willful misconduct, or fraud is never limited.

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