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Ugo [173]
3 years ago
14

Parties may stipulate the damages to be recovered in case of nonperformance, defective performance, or delay in performance of a

n obligation. These are called:
Social Studies
1 answer:
Nana76 [90]3 years ago
6 0

Answer:

Liquidated Damages.

Explanation:

The <em>scope of a liquidated damage is determined by parties during the process of developing contract that they intended to enter into</em>. Such damages do not have a objective scope and depend on multiple factors.

<u>For example</u>, the first party of the contract promises to provide a venue for an art fair to the second party of the contract, which would hold such a fair for the first time. If the first party fails to provide the venue on time, the second party is not going to be able to make a profit from holding the art fair. Meanwhile, it is impossible to determine the amount of profit that the second party lost due to the beach of the contract by the first party. That is why scope of such damages has to be agreed upon in advance.

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