A liquidated damages clause in a contract provides for the payment of a fixed sum, or a sum calculated in a pre-determined manner, as compensation to one party when the other party is in breach of contract. Liquidated damages are commonly used, for example, to determine the compensation paid for a performance delay when a fixed date is missed, or for a failure to perform to a contractual standard (service credits under a service level agreement are a form of liquidated damages).
This resource is only available to our paid members. You can Join Us or Sign in to get access to this resource.