PENALTY CLAUSE
PENALTY CLAUSE penalty clause. A contractual provision that assesses against a defaulting party an excessive monetary charge unrelated to actual harm. ? Penalty clauses are generally unenforceable. ¡ª Often shortened to penalty. ¡ª Also termed penal clause. Cf. LIQUIDATED-DAMAGES CLAUSE; LIMITATION-OF-REMEDIES CLAUSE . [Cases: Damages 76, 80. C.J.S. Damages ¡ì¡ì 176, 185¨C187, 190¨C192, 194.] ¡°It […]