Question

Stewart, the owner of abc construction, agreed with joan, the owner of xyz hotel, that he would complete renovations on her upscale hotel on the beach in florida by october 1. the amount due to stewart under the contract was $250,000. the contract contained a clause by which stewart would pay joan $50,000 for each day he was late on completing the project.

Answer 1

The appropriate term for the agreement for Stewart to pay the loan of $50,000 for each day that he was late in completing the project is liquidated damages clause. A liquidated damages clause specifies the amount of money that must be paid due to the failure to perform the project which is based on the contract.