Liquidated Damages
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Contracts & Sales · Lesson 14
Liquidated Damages
這一課問的是：合約中事先約定的「違約金條款」何時可被法院執行？
Actor
Act
Object
Standard
Consequence
Core Terminology · 7 must-know
Tap a card to flip and reveal the meaning.
liquidated damages
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Sum stipulated in the contract as the amount payable on breach.
違約金。
reasonable estimate
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Forecast must be reasonable when contracting.
合理估計。
difficult to ascertain
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Actual damages must be difficult to determine.
難以確定。
penalty clause
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Designed to punish rather than compensate — unenforceable.
懲罰條款。
Rule Sentence · the workhorse
A liquidated-damages clause is enforceable if the stipulated sum was a reasonable forecast of probable loss at the time of contracting and the actual loss would have been difficult to determine; clauses functioning as penalties — punishing breach rather than compensating for it — are unenforceable.
Mini IRAC · build the Application
Issue. Is a clause requiring a contractor to pay $5,000 per day of delay enforceable when actual delay damages would be hard to prove and $5,000 was a reasonable forecast at contracting?
Rule. A liquidated-damages clause is enforceable if it was a reasonable forecast of probable loss at contracting and actual damages would have been difficult to determine.
Application (model). The contract stipulated $5,000 per day of delay; the parties knew at contracting that delay losses would be hard to measure, and the figure was within a reasonable range of expected daily harm. Because liquidated damages are enforceable when they were a reasonable forecast of probable, hard-to-measure loss, the fact that the $5,000 figure matched both the difficulty of proving actual delay damages and a reasonable estimate of them at the outset means the clause operated as compensation, not punishment.
Pick the right element for each blank:
g1.
g2.
Conclusion. Therefore, the liquidated-damages clause is enforceable.
Practice Drill · tap to build the rule
Drop the chips here in correct order:
Tap chips to add → tap chips in the target to remove: