A contractual clause that purports to relieve a party from liability for negligence is called?

• A. Accord and satisfaction
• B. Gratuitous promise
• C. Exculpatory clause
• D. Insurable interest

Answer: (C)

Relieving a party from liability for negligence through a contract is called an exculpatory clause. It’s a provision that attempts to shift or waive the risky liability for negligent acts, often appearing in waivers or releases you sign before participating in an activity or using a service. These clauses can be enforceable in some situations, but many jurisdictions limit them, especially when public policy, a duty of care, or essential services are involved.

Accord and satisfaction is about settling a claim by accepting something different than what was owed, not specifically about releasing negligence. A gratuitous promise is a promise made without consideration and doesn’t by itself create a liability-release term. An insurable interest refers to having a stake in the insured subject matter, which is a concept in insurance, not a contract that releases liability.