Business Law 4th Edition by David Twomey,Marianne Jennings

Exercise 11

Kuznicki made a contract for the installation of a fire detection system by Security Safety Corp. for $498. The contract was made one night and canceled at 9:00 the next morning. Security then claimed one-third of the purchase price from Kuznicki by virtue of a provision in the contract that "in the event of cancellation of this agreement... the owner agrees to pay 331/3 percent of the contract price, as liquidated damages." Was Security Safety entitled to recover the amount claimed? [Security Safety Corp. v Kuznicki, 213 NE2d 866 (Mass)]