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William T. Russell Jr. and Linton Mann III William T. Russell Jr. and Linton Mann III

The Court of Appeals recently clarified the ability of parties to limit their liability for grossly negligent conduct in a breach of contract action. In Deutsche Bank National Trust Company v. Morgan Stanley Mortgage Capital Holdings, the court held that the public policy rule prohibiting parties from insulating themselves for damages resulting from grossly negligent conduct only applies to contractual provisions that either completely immunize a party or provide for solely nominal damages. It does not apply to other provisions that simply limit, but do not eliminate, the remedies available to a plaintiff for breach.

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