Reasonableness of Liquidated Damages Determined at Time of Contract (or, You Can’t Look Back Again)

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In the latest opinion, the Court looked at when and how any liquidated damages would be calculated.

October 5, 2020
Christopher G. Hill - Construction Law Musings

I’ve discussed the continuing litigation between White Oak Power Constructors v. Mitsubishi Hitachi Power Systems Americas, Inc. previously here at Construction Law Musings because the case was another reminder that your construction contract terms matter and will be interpreted strictly here in the Commonwealth of Virginia. The prior opinion in this case from the Eastern District of Virginia court the Court considered the applicability of a liquidated damages provision. In the latest opinion from the Court (PDF) the Court looked at when and how any liquidated damages would be calculated. In its June 22, 2020 opinion, the Court put the issue as follows:

White Oak’s motion for partial summary judgment presents a narrow issue: whether courts may consider the damages actually sustained by a party as a result of a contract breach when deciding if liquidated damages required by a contract “grossly exceed” a party’s actual damages.

Mr. Hill may be contacted at chrisghill@constructionlawva.com



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