Part 16U.K.Audit

Modifications etc. (not altering text)

C4Pts. 1-39 modified (31.12.2020) by Regulation (EC) No. 2157/2001, Art. AAA1(3) (as inserted by The European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1298), regs. 1, 97 (with regs. 140-145) (as amended by S.I. 2020/523, regs. 1(2), 5(a)-(f)); 2020 c. 1, Sch. 5 para. 1(1))

Chapter 6U.K.Auditors' liability

Liability limitation agreementsU.K.

534Liability limitation agreementsU.K.

(1)A “liability limitation agreement” is an agreement that purports to limit the amount of a liability owed to a company by its auditor in respect of any negligence, default, breach of duty or breach of trust, occurring in the course of the audit of accounts, of which the auditor may be guilty in relation to the company.

(2)Section 532 (general voidness of provisions protecting auditors from liability) does not affect the validity of a liability limitation agreement that—

(a)complies with section 535 (terms of liability limitation agreement) and of any regulations under that section, and

(b)is authorised by the members of the company (see section 536).

(3)Such an agreement—

(a)is effective to the extent provided by section 537, and

(b)is not subject—

(i)in England and Wales or Northern Ireland, to section 2(2) or 3(2)(a) of the Unfair Contract Terms Act 1977 (c. 50);

(ii)in Scotland, to section 16(1)(b) or 17(1)(a) of that Act.

Modifications etc. (not altering text)