#contract #law #remedies
However, where the sum inserted in the clause is intended to deter breach or as a punishment on the contract-breaker and is not connected with the amount of loss which could be contemplated by the parties at the time of contracting, the sum is treated as a penalty. Penalty clauses are unenforceable and the injured party may bring an action for unliquidated damages (to be assessed in the usual way).
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