hey are excluded from liability under the limitation clause. The main obstacle to this finding is the doctrine of privity of contract; Iacobucci states that the only reason to reject the employee's claim is a strict adherence to this doctrine. He holds that when the parties signed the contract they knew of the clause, and knew that employees of the company would be handling the material. He also says that this change to the doctrine of privity is only incremental, and not large enough to require legislative support. In this case he says that to allow the employees to benefit from the limitation coincides with the agreement of the parties when they signed the contract. Further, there are policy reasons to allow the exclusion – particularly that employees do not expect to be found liable when there are clauses that specifically state that they are excluded.
He sets out a two-step test that must be satisfied in order for employees to be excluded from liability:
the limitation of liability clause must, either expressly or impliedly, extend its benefit to the employee(s) seeking to rely on it; and
the employees must have been acting in the course of their employment and must have been performing the very services provided for in the contract between their employer and the other party when the loss occurred.