The purpose of an entire agreement clause (EAC) is to convey in an unequivocal manner that the written contract in which it is incorporated, sets out the entire decision of the parties, so that either party will be precluded from instituting proceedings in connection with preceding agreements, discussions, negotiations, promises, undertakings, pre-contractual statements or representations made prior to the conclusion of the written contract. EAC clauses fall under the so-called "boilerplate" provisions which, having not had the benefit of prior negotiation, have a tendency to be overlooked, without further consideration or thought being afforded as to their legal significance or implications. This can result in a tenuous position which might ultimately prove to be prejudicial to the interests of either of the parties to the contract who might seek to challenge or rely on the EAC'S provisions to support their respective legal positions.
It is now becoming increasingly clear that the precise wording used when drafting an EAC is important and can prove critical as the number of disputes concerning the effectiveness of entire agreement clauses demonstrates. The Court of Appeal case of AXA Sun Life Services Plc v Campbell Martin Ltd  EWCA Civ 133 opined that such clauses must be carefully drafted to ensure that that no terms or pre-contractual negotiations will be construed as forming part of the contract. Furthermore, the case also demonstrates that liability for misrepresentation can be avoided if the relevant clause is worded correctly. EACs such as, “This Agreement constitutes the entire agreement between or among the parties pertaining to the subject matter contained in it and supersedes all prior and contemporaneous agreements, representations, and understandings of the parties”, are no longer sufficient. To ensure that liability is totally excluded, it is safer if EACs clearly exclude liability for misrepresentation in their wording.
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