liquidated damages

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liquidated damages

A sum specified in a contract whereby damages in the event of breach are to be determined. In a construction contract, liquidated damages usually are specified as a fixed sum per day for failure to complete the work, 1 within a specified time. If set at a level consistent with a reasonable forecast of actual harm to the owner, liquidated damage clauses will be upheld and will preclude use of standards for computation of damages that would otherwise be imposed by law. If the amount prescribed for liquidated damages is unreasonably high, the provision will be denominated an illegal “penalty” by the courts and held invalid; in such case, damages will be determined pursuant to otherwise applicable rules of law.
References in periodicals archive ?
2d at 100 (asserting unliquidated damages difficult for judge to quantify).
67) See id (reasoning "to allow a district court judge to value a plaintiffs claim in a case which involves a demand for unliquidated damages and in which the jurisdictional issue is inextricably bound up with the merits of the controversy is tantamount to depriving the plaintiff of his present statutory right to a jury trial").
c]ommon law undeniably recognized actions for unliquidated damage awards.
Alpha Tire claims liquidated damages from South China in the amount of US$314,302 and claims unliquidated damages in excess of US$10 million in respect of the termination of a consulting agreement which related to the Guilin Tire Factory.