Markborough, a developer, and Glenn, the engineering firm, entered into a contract wherein Glenn agreed to design a man-made lake. Markborough then filed an action to recover the damages incurred as a result of the failure of the lake liner. Markborough argued that the phrase should be narrowly construed, such that the parties were required to make full disclosure of the risks involved in the construction project. So long as the parties had such an opportunity, a limitation of liability provision would be enforced, even if there was no actual discussion regarding the provision, which was simply proposed and accepted. Opposition to Limitation of Liability Clauses.
Some states specifically oppose limitation of liability clauses.
The City of Dillingham had entered into a contract with the engineer to perform engineering services relating to the City's sewage treatment plant. City of Dillingham , supra . The City then awarded a contract for the construction of the sewage treatment facility. Subsequently, the contractor filed an action against the City for damages caused by differing site conditions and the City in turn filed a third party complaint against the engineer for breach of contract, breach of duty of care and breach of fiduciary duty. The Court held that Alaska Statute 45.45.900, which generally renders void contractual provisions purporting to indemnify a promisee against liability for damages caused by the promisee's sole negligence or willful misconduct, also prohibits limitation of liability clauses.