Mica Co argeed to commercial storage building by september 1 for Pack Rat Storage. It was hard to predict Pack Rat's losses if the building was not completed on time. The parties estimated that Pack Rat would lose $200 in storage fee per day if the building was not completed on time. Thus, the contract required Mica to pay liquidated damages of $200 per day if work was completed late. Mica finished ten days late. Pack Rat actually lost $1800 due to the work was completed late. Mica finished ten days late. Pack Rat actually lost $1800 due to the breach. 1.Is the liquidated damage amount stated in the contract between Mica. Co. and Pack Rat Storage valid, or is it an invalid penalty? 2. How much in damages can Pack Rat recover from Mica Co.?
2006-06-27 13:52:36 · 3 answers · asked by Nice girl 3 in Politics & Government ➔ Law & Ethics
If the contract specifies $200 per day in damages, that's it. Really, it's impossible to know for certain how much you lost - maybe there were other customers who would have rented if they saw your building was done. Typically, a damages clause will specify that since actual damages are impossible to determine, the parties agree to a specific amount.
2006-06-27 14:26:55 · answer #1 · answered by nkasoff 3 · 0⤊ 0⤋
a liquidated damages clause in a contract will be upheld if reasonable relation amount of anticipated damages. Cannot be a large amount designed to punish.
2006-06-27 16:03:04 · answer #2 · answered by bestanswer 2 · 0⤊ 0⤋
Does your Damages class professor know you are looking for answers to assigned problems on the internet?
2006-06-27 20:58:23 · answer #3 · answered by mattapan26 7 · 0⤊ 0⤋