penalty clause

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penalty clause

A contract provision setting forth the damages a party must pay in the event of his breach. If such a clause is regarded by the court as too harsh to be regarded as a fair estimate of probable damages, it will normally be held invalid. See liquidated damages.
References in periodicals archive ?
whether the penalty clauses were unconscionable (At para.
But when the delay is brought about by contractors, or like the adverse weather in August, there never seems to be a penalty clause that's so severe it makes them get the job done on time.
If you are considering accepting a prepayment penalty clause, make sure you know the details of your contract:
We have penalty clauses in our contract with Nexus which were activated during the summer due to the service problems.
Why do we put up with this level of crass incompetence from politicians who fail to incorporate penalty clauses in major contracts and contractors who are incapable of finishing on time?
Perhaps construction firms would improve their performance if more fixed price penalty clauses were included in public works contracts.
Can they assure us that all penalty clauses have been agreed, that the contractor will not go into administration, that all supplies have been ordered (local sources hopefully) and that the delivery dates are accurate and that everyone knows what they are doing?
5 million fixed-price deal to build the stadium, with crippling penalty clauses if the project over-runs
Transport Minister Andrew Davies has admitted the contract for the work included no penalty clauses, which would have fined the contractor for not handing over the road by the agreed deadline.
There are often penalty clauses specifying what the damages will be.
In addition penalty clauses for when companies fail to meet targets have been relaxed.
Next time I will," says Brown, who will also be sure the new contract includes penalty clauses in the event that the builders take longer than quoted.