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The question of the validity of liability limitation provision in a contract for the purchase of an advertisement in a Yellow Pages directory has been considered by various decisions in other jurisdictions. The large majority of these decisions have upheld it thereby limiting the telephone company's liability for defective advertisements in its Yellow Pages to the amount of the advertising charges. However, some courts have limited the application of such a provision to acts of ordinary negligence or carelessness. Such a limitation provision will not be applicable to gross negligence or willful or wanton misconduct.
Plaintiff advertiser entered into a contract with the agent of the telephone company for advertising space in the Yellow Pages directory. The directory was published with a defect in the drawing depicting the advertiser's product. The advertiser filed suit against the telephone company and its agent for its loss of business damage to its reputation. While the trial court entered judgment in favor of the advertiser, it determined that the advertiser's damages were limited under the terms of the parties' contract to the amount charged for the advertisement. The advertiser appealed.
Under the circumstances, did the trial court err in applying the limitation of liability provision found in the parties’ contract?
In affirming, the court concluded that the trial court did not err in applying the limitation of liability provision where the defect in the advertisement was connected with the product illustration but where the balance was free from error. Such a defect could not be attributable to anything but carelessness. Further, the agent was not liable for the defective advertisement because, under La. Civ. Code Ann. art. 3013, the agent was not responsible for the principal's acts where the agent did not bind itself personally and did not exceed its authority.