Liquidated damages are enforceable if ________.
A) actual damages are difficult to determine
B) they are excessive or unconscionable
C) the damage is considered to be a penalty
D) damages do not result in a loss of money to the nonbreaching party

Question

Quizplus · Accepted Answer

Liquidated damages are enforceable if actual damages are difficult to determine, which means that the amount specified in the contract is a reasonable estimate of the harm that would result from a breach. If actual damages can be easily calculated, then liquidated damages are considered a penalty and are unenforceable. Additionally, liquidated damages cannot be excessive or unconscionable, and they must result in a loss of money to the nonbreaching party.

Liquidated Damages Are Enforceable If ________