In the contract of loan, a stipulation not to be liable for fraud is not valid.

Explanation

(English-origin maxim.) A borrower cannot contractually exempt himself from liability for fraud in the loan — the law will not enforce a clause that shields a party from the consequences of his own deceit.

Where this applies

• A borrower includes a clause in a loan agreement saying he is not liable if he commits fraud, and the court strikes the clause as void against public policy.
• A lender and borrower agree that neither party can be held responsible for fraudulent misrepresentations in the loan documents — the court refuses to enforce that provision.
• A payday lender's contract includes fine print releasing the lender from all fraud liability, and a court holds that clause unenforceable because you cannot contract away liability for your own deceit.