Test as to whether provision enforceable as liquidated damages.

- In deciding whether a contract provision is enforceable as liquidated damages, the court makes a tripartite inquiry to determine if the following factors are present: first, the injury caused by the breach must be difficult or impossible of accurate estimation; second, the parties must intend to provide for damages rather than for a penalty; and third, the sum stipulated must be a reasonable preestimate of the probable loss. Thorne v. Lee Timber Prods., Inc., 158 Ga. App. 226, 279 S.E.2d 521 (1981).

Distinction between penalty and liquidated damages.

- See Sanders & Ables v. Carter, 91 Ga. 450, 17 S.E. 345 (1893); Heard v. Dooly County, 101 Ga. 619, 28 S.E. 986 (1897).

When bond sets penalty below actual damages, surety not liable for more than amount stipulated.

- When penalty in bond is for certain sum, less than actual amount of damages, surety is not liable for more than that sum with interest. Westbrook v. Moore, 59 Ga. 204 (1877); Scarrat v. Cook Brewing Co., 117 Ga. 181, 43 S.E. 413 (1903).

Award of damages by arbitrator equal to actual damages will be upheld although contract provided for penalty. Georgia Land & Cotton Co. v. Flint, 35 Ga. 226 (1866).

Damages accurately expressed in monetary terms to be distinguished from those which are not.

- In determining the validity of a liquidated damages provision in a contract, it is important to distinguish damages which are difficult to accurately determine in monetary terms from those damages which can be accurately established, albeit via a complicated procedure. Thorne v. Lee Timber Prods., Inc., 158 Ga. App. 226, 279 S.E.2d 521 (1981).

Cited in Butler v. Moore, 68 Ga. 780, 45 Am. R. 508 (1882); Lytle v. Scottish Am. Mtg. Co., 122 Ga. 458, 50 S.E. 402 (1905); Martin v. Lott, 144 Ga. 660, 87 S.E. 902 (1916); Caldwell Lumber Co. v. Wright, 22 Ga. App. 411, 96 S.E. 391 (1918); Standard Motors Fin. Co. v. O'Neal, 35 Ga. App. 727, 134 S.E. 843 (1926); Martin v. Citizen's Bank, 177 Ga. 871, 171 S.E. 711 (1933); National Manufacture & Stores Corp. v. Dekle, 48 Ga. App. 515, 173 S.E. 408 (1934); Miazza v. Western Union Tel. Co., 50 Ga. App. 521, 178 S.E. 764 (1935); Sizemore v. Beeler, 94 Ga. App. 414, 94 S.E.2d 773 (1956); Sanders v. Carney, 118 Ga. App. 576, 164 S.E.2d 856 (1968); Concrete Materials of Ga., Inc. v. Smith & Plaster Co., 127 Ga. App. 817, 195 S.E.2d 219 (1973); Military Armament Corp. v. ITT Terryphone Corp., 134 Ga. App. 694, 215 S.E.2d 724 (1975); Hughes Motor Co. v. First Nat'l Bank, 136 Ga. App. 295, 220 S.E.2d 782 (1975); Gibson v. Sheriff, 155 Ga. App. 578, 271 S.E.2d 710 (1980).

Am. Jur. 2d.

- 17 Am. Jur. 2d, Contracts, §§ 499, 500.

C.J.S.

- 25 C.J.S., Damages, § 195.

ALR.

- A provision in land contract for pecuniary forfeiture or penalty by a party in default as affecting the right of the other party to specific performance, 32 A.L.R. 584; 98 A.L.R. 877.

Provision in land contract for pecuniary forfeiture or penalty upon default of the purchaser as affecting the vendor's right to maintain an action for the purchase price, 32 A.L.R. 617.

Valuation clause in carrier's contract as limit, or as ratio, of recovery in case of partial loss, 41 A.L.R. 450.

Measure of damages for purchaser's breach of contract to buy real property, 52 A.L.R. 1511.

Stipulation as to amount recoverable for breach of contract against entering certain business or employment as a provision for liquidated damages or for a penalty, 59 A.L.R. 1135.

Stipulation as to damages in case of breach of contract for purchase of goods to be manufactured by other party, as penalty or liquidated damages, 79 A.L.R. 188.

Measure of damages for breach of contract for sale or purchase of equipment, supplies of gasoline, etc., used in operation of gasoline filling station, 81 A.L.R. 99.

Provisions by which upon breach of contract the entire amount remaining unpaid thereof shall become immediately due as one for penalty or for liquidated damages, 104 A.L.R. 223.

Provision in lease for pecuniary forfeiture where lease is prematurely terminated as one for liquidated damages, 106 A.L.R. 292.

Liability of building or construction contractor for liquidated damages for breach of time limit where work is delayed by contractee or third person, 152 A.L.R. 1349.

Provision in land contract for forfeiture of payments as one for liquidated damages or penalty, 6 A.L.R.2d 1401; 4 A.L.R.4th 993.

Validity and construction of provision for liquidated damages in contract with cooperative marketing association, 12 A.L.R.2d 130.

Allowance of attorneys' fees over and above penal sum stated in private contractor's bond, 59 A.L.R.2d 469.

Validity and construction of "no damage" clause with respect to delay in building or construction contract, 74 A.L.R.3d 187.

Contractual liquidated damages provisions under UCC Article 2, 98 A.L.R.3d 586.

Measure and elements of damages for breach of contract to lend money, 4 A.L.R.4th 682.

Modern status of defaulting vendee's right to recover contractual payments withheld by vendor as forfeited, 4 A.L.R.4th 993.

Recovery based on tortfeasor's profits in action for procuring breach of contract, 5 A.L.R.4th 1276.

Contractual provision for per diem payments for delay in performance as one for liquidated damages or penalty, 12 A.L.R.4th 891.