At a brokerage meeting in Scottsdale, a broker says a liquidated-damages clause always means the nonbreaching party can recover any larger actual loss later as well. What is the most accurate response?
Correct Answer
A) a true liquidated-damages provision is meant to set the agreed remedy within the clause's scope rather than guarantee unlimited extra recovery
Under Arizona contract law; current AAR contract concepts, a true liquidated-damages provision is meant to set the agreed remedy within the clause's scope rather than guarantee unlimited extra recovery.
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Related Topics & Key Terms
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Related Concepts
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
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