Chapter 18: Contract Remedies

Question 1

Remedies

Answer 1

a court-ordered compensation to one party’s breach of contract

Question 2

Liquidated Damages Clause

Answer 2

contractual provision required a party in breach to pay a pre-determined amount to the injured party for breach of contract

Question 3

What are the two criteria for liquidated damages?

Answer 3

1. It must be a reasonable approximation for the amount caused by the damages
2. It must be intended to avoid the costs that would amount in litigating the damages