Liquidated Damages in California

Liquidated Damages in California

A matter of interpretation: Ambiguous contracts and liquidated damages

Contract Renegotiation, Mechanism Design, and the Liquidated Damages Rule

Risk and Uncertainty Program TITLE: A matter of interpretation: ambiguous contracts and liquidated damages AUTHORS:

We focus on syntactic aspects of differential awareness that give rise to contractual disputes. Boundedly rational parties use a common language, but do not share a common understanding of the world, leading to ambiguity in both syntactic and semantic forms. In contractual relationships, ambiguity leads to disagreement and disputes. We show that the agents may prefer simpler less ambiguous cont...

An Austrian Perspective on the Law of Liquidated Damages: the Case for an All-enforcement Rule

At common law, courts will not enforce liquidated damages clauses unless the stipulated sum bears a reasonable relation to either the anticipated or actual losses that result from breach. Penalty clauses, intended to compel performance, are per se unenforceable. Commentators have set forth arguments both for and against this common-law rule on the basis of efficiency. One of the main principles...