Home › CA Foundation › businesslaw › Breach of Contract and its Remedies › A stipulated sum that is a genuine pre-estimate …
A stipulated sum that is a genuine pre-estimate of the likely loss on breach is best described as:
AVindictive damages
BLiquidated damages
CNominal damages
DA penalty
Answer & Solution
Correct answer: B. Liquidated damages
Liquidated damages are a genuine pre-estimate of the probable loss; a penalty is an extravagant sum fixed in terrorem to compel performance.
Related questions
A agrees to sell rice to B for delivery in two months; on the due date the market price haTo the rule that compensation cannot exceed the stipulated sum, an exception exists where Under Section 75, a party who rightfully rescinds a contract is:A court order restraining a party from doing what he promised not to do (e.g. a singer perWhere damages are not an adequate remedy, the court may order the defaulting party to actuA claim on quantum meruit is available only if:The remedy of 'quantum meruit' means a claim for:How does Indian law treat the distinction between 'penalty' and 'liquidated damages'?