Section 537: Effect of liability limitation agreement
827.This section provides that a liability limitation agreement will not be effective to limit an auditor’s liability if the limitation would result in the company recovering an amount that was less that what was fair and reasonable, in all the circumstances of the case, having regard in particular to the auditor’s responsibilities, the auditor’s contractual obligations, and the standards expected of the auditor. If a court decides that a liability limitation agreement would limit the auditor’s liability to an excessive degree, the agreement will have effect as if it limited liability to the amount that the court determines is fair and reasonable.
828.Subsection (3) provides that in assessing what is fair and reasonable, the court should not take into account circumstances arising after the loss or damage in question has been incurred. Nor should it take into account the chances of the company successfully claiming compensation from any other people responsible for the loss or damage.