penalty clause
Breach triggers payment
A penalty clause is a provision in a contract specifying consequences—usually a fixed sum of money—for breach or failure to perform.
The penalty clause required a payment of $10,000 for each day of delay.
Courts often distinguish penalty clauses from liquidated damages clauses, refusing to enforce penalties deemed excessive or punitive rather than compensatory.
- fineAcceptable in quality
- pay upSettle a debt
- breachBreaking of agreement
- agreementShared position between parties
- fine printMiniature contractual text
forfeiture · force majeure · punitive · contract · breach of contract · obligation · settlement agreement · indemnity · contractual obligation · non-performance · late payment · enforcement · liability · rescission · damages · payment terms · consequence · deal breaker
- contract termscontract terms, agreement, terms, conditions, condition
- penaltiesfine, infractions, violations, fouls, foul
- contractsbinding contracts, contract length, lease, contract terms, work contract
- Contract disputesbreach, nonpayment, fraud, misrepresentation, termination
- contract clausesforce majeure, dispute resolution, boilerplate, clauses, provision
- procurementprocurement, purchasing, purchase order, bidding, subcontract
penalty clausebonus clause
Contract term for extra compensation
performance bonus · completion bonus · golden parachute · signing bonus · retention bonus