aggregate liability
Definition
Aggregate liability is the maximum total amount of money a party can be held responsible for over a specific period, no matter how many claims or incidents arise. Think of it like a cap on a bucket — once the bucket is full, no more water goes in, regardless of how many people are trying to pour.
Example
If your software contract includes a $50,000 aggregate liability cap, and three different clients sue you for damages in the same year, the total you owe all of them combined cannot exceed $50,000.
Watch Out
These caps can work both for and against you, so pay close attention to whether you are the one offering or accepting the cap before you sign anything.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.