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Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc.: Difference between revisions
Lost Student (talk | contribs) (Created page with "''Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc.'', 41 N.Y.2d 420, 393 N.Y.S.2d 365, 369, 361 N.E.2d 1015, 1018 (1977). '''Facts''': Defendant leased trucks from Plaintiff...") |
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{{Infobox Case Brief | |||
|citation=41 N.Y.2d 420, 393 N.Y.S.2d 365, 369, 361 N.E.2d 1015, 1018 (1977) | |||
|subject=Contracts | |||
}} | |||
'''Facts''': Defendant leased trucks from Plaintiff. K had a liquidated damages clause. The amount awarded by the clause was more than the remaining value of the lease. | '''Facts''': Defendant leased trucks from Plaintiff. K had a liquidated damages clause. The amount awarded by the clause was more than the remaining value of the lease. | ||
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If the three conditions are not all satisfied, a liquidated damages clause will not be enforced. | If the three conditions are not all satisfied, a liquidated damages clause will not be enforced. | ||
#Actual damages are difficult to estimate at the time the K was made. | # Actual damages are difficult to estimate at the time the K was made. | ||
#Liquidated damages are a reasonable estimate of the anticipated loss. | # Liquidated damages are a reasonable estimate of the anticipated loss. | ||
#Liquidated damages are not grossly disproportionate to the probable loss (No Punitive Damages) | # Liquidated damages are not grossly disproportionate to the probable loss (No Punitive Damages) | ||
Latest revision as of 04:05, January 14, 2020
| Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc. | |
| Court | |
|---|---|
| Citation | 41 N.Y.2d 420, 393 N.Y.S.2d 365, 369, 361 N.E.2d 1015, 1018 (1977) |
| Date decided | |
Facts: Defendant leased trucks from Plaintiff. K had a liquidated damages clause. The amount awarded by the clause was more than the remaining value of the lease.
Issue: Is the clause enforceable?
Holding: Held for the Plaintiff. The clause is enforceable.
Rule: "A contractual provision fixing damages in the event of breach will be sustained if the amount liquidated bears a reasonable proportion to the probable loss and the amount of actual loss is incapable or difficult of precise estimation. . . . If, however, the amount fixed is plainly or grossly disproportionate to the probable loss, the provision calls for a penalty and will not be enforced."
If the three conditions are not all satisfied, a liquidated damages clause will not be enforced.
- Actual damages are difficult to estimate at the time the K was made.
- Liquidated damages are a reasonable estimate of the anticipated loss.
- Liquidated damages are not grossly disproportionate to the probable loss (No Punitive Damages)
