Which of the following is generally true regarding a liquidated-damage clause?
A)A liquidated-damage clause is per se illegal.
B)A liquidated-damage clause is void in the interests of public policy.
C)A liquidated-damage clause is voidable in the interests of public policy.
D)A liquidated-damage clause is enforceable if it is not punitive in nature.
E)A liquidated-damage clause will be enforced,regardless of whether it is punitive in nature.

Question

Quizplus · Accepted Answer

Liquidated-damage are damages identified before the breach occurs.Buyers and sellers are free to negotiate,as part of the contract,a liquidated-damage clause in which the parties agree in advance what the damages will be for each party if a breach occurs.Generally speaking,a court will enforce a liquidated-damage clause as long as it is not so far out of reasonable range as to be punitive in nature.Liquidated-damage clauses that are deemed punitive in nature are not enforceable.

Which of the Following Is Generally True Regarding a Liquidated-Damage