What is the legal term given to a provision in a contract whereby the parties agree in advance the amount to be paid in the event of a contract breach?
A) an applied term
B) a liquidated damages clause
C) a punitive clause
D) an exemption clause

Question

Quizplus · Accepted Answer

A liquidated damages clause is a provision in a contract that specifies a predetermined amount of money that must be paid as damages in the event of a breach of the contract. This allows the parties to know in advance what the consequences of a breach will be, providing a measure of certainty and potentially avoiding litigation over damages.

What Is the Legal Term Given to a Provision in a Contract