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liquidated damages and penalty clause

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › liquidated damages and penalty clause

  • This topic has 1 reply, 2 voices, and was last updated 12 years ago by MikeLittle.
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  • June 5, 2013 at 2:40 pm #129382
    aishaasad
    Member
    • Topics: 159
    • Replies: 185
    • ☆☆☆

    Hi Sir
    I want to ask why there is a difference in the judgement of the two cases DUNLOP PNEUMATIC TYRE V NEW GARAGE AND MOTOR and FORD MOTOR V ARMSTRONG when in both cases there was a single amount estimated for all the breaches
    but the first one is regarded as genuine preestimate whereas in second case the amount payable for different breaches is penalty and hence void?
    can you please differentiate between how to gauge whether amount estimated is penalty or genuine pre estimate
    Thanks

    June 5, 2013 at 6:31 pm #129524
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23327
    • ☆☆☆☆☆

    If it’s claimed to be a genuine pre-estimate, the claimant would have to show the basis of the calculation arriving at the per diem rate. In Interfoto v Stiletto the “pre-estimate arrived at a figure across the board whereas in fact the pictures were quite varied and the Court decided that this was not a genuine pre-estimate at all.

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