Sentences with phrase «determine penalty clauses»

The majority of the Supreme Court held that the new test to determine penalty clauses is whether the impugned provision is a secondary obligation which imposes a detriment on the contract - breaker out of all proportion to any legitimate interest of the innocent party in the enforcement of the primary obligation.1

Not exact matches

Lord Dunedin in Dunlop Tyre laid down the guidelines to assist in determining if a clause for payment of a fixed sum was a penalty or a genuine pre-estimate of loss:

In determining whether a contractual provision is a penalty clause, the test has been to assess whether the consequence that follows the breach of that provision is a genuine pre-estimate of the innocent party's loss.

The application judge found that the two - member firm partnership had been dissolved and declared the restrictive covenant unenforceable as a penalty, but directed a trial of an issue to determine the damages payable by the appellant as a result of a breach of the portion of the portion of the covenant he found valid and severable — the withdrawal having triggered a clause in the agreement which called for the reduction of the withdrawing partner's capital account «by 500 % of the average fees billed by the firm to clients who transfer to the withdrawing partner within 24... Read More

The application judge found that the two - member firm partnership had been dissolved and declared the restrictive covenant unenforceable as a penalty, but directed a trial of an issue to determine the damages payable by the appellant as a result of a breach of the portion of the portion of the covenant he found valid and severable — the withdrawal having triggered a clause in the agreement which called for the reduction of the withdrawing partner's capital account «by 500 % of the average fees billed by the firm to clients who transfer to the withdrawing partner within 24 months of the withdrawal date».