Mich. Comp. Laws § 440.2718

Liquidation and limitation of damages; restitution to buyers.

Find cases: SyfertCases citing this section MI-LEGlegislature.mi.gov JustiaChapter on Justia CornellLII Search CasesGoogle Scholar

UNIFORM COMMERCIAL CODE

Act 174 of 1962

440.2718 Liquidation and limitation of damages; restitution to buyers.

Sec. 2718.

(1) Damages for breach by either party may be liquidated in the agreement but only at an amount which is reasonable in the light of the anticipated or actual harm caused by the breach, the difficulties of proof of loss, and the inconvenience or nonfeasibility of otherwise obtaining an adequate remedy. A term fixing unreasonably large liquidated damages is void as a penalty.

(2) Where the seller justifiably withholds delivery of goods because of the buyer's breach, the buyer is entitled to restitution of any amount by which the sum of his payments exceeds

(a) the amount to which the seller is entitled by virtue of terms liquidating the seller's damages in accordance with subsection (1), or

(b) in the absence of such terms, 20% of the value of the total performance for which the buyer is obligated under the contract or $500.00, whichever is smaller.

(3) The buyer's right to restitution under subsection (2) is subject to offset to the extent that the seller establishes

(a) a right to recover damages under the provisions of this article other than subsection (1), and

(b) the amount or value of any benefits received by the buyer directly or indirectly by reason of the contract.

(4) Where a seller has received payment in goods their reasonable value or the proceeds of their resale shall be treated as payments for the purposes of subsection (2); but if the seller has notice of the buyer's breach before reselling goods received in part performance, his resale is subject to the conditions laid down in this article on resale by an aggrieved seller (section 2706).

History: 1962, Act 174, Eff. Jan. 1, 1964

Notes of Decisions

Cited in 7 cases (1 in the last 5 years), 1982–2021 · leading case: Sullivan Industries, Inc. v. Double Seal Glass Co.

Sort: Relevance Newest Treatment

Sullivan Industries, Inc. v. Double Seal Glass Co. (1991) michctapp “2316, while primarily concerned with the exclusion or modification of warranties, also provides that a seller may limit by agreement the buyer’s remedies for breach of warranty pursuant to MCL 440.2718, 440.2719; MSA 19.2718, 19.2719.”

Latimer v. William Mueller & Son, Inc. (1986) michctapp “See MCL 440.2718, 440.2719; MSA 19.2718, 19.2719.”

Colonial Dodge, Inc. v. Miller (1982) michctapp · cites it 2× “2612, pertaining to installment contracts and §§ 2-718, MCL 440.2718; MSA 19.2718, and 2-719, MCL 440.”

Exemplar Manufacturing Co. v. Lear Corp. (In Re Exemplar Manufacturing Co.) (2005) mieb · cites it 4× “” Mich. Comp. Laws Ann. § 440.2718 (1)[UCC § 2-718], provides in relevant part that: Damages for breach by either party may be liquidated in the agreement but only at an amount which is reasonable in the light of the anticipated or actual harm caused by the breach, the…”

Skyline Steel Corp. v. A.J. Dupuis Co. (1986) mied · cites it 2× “§ 440.2718(1). 17 Whether a liquidation provision is unreasonable is a question of law for the court to determine in light of all the circumstances.”

Hemlock Semiconductor Corp. v. Kyocera Corp. (2018) ca6 · cites it 2× “Mich. Comp. Laws § 440.2718 (1); Moore v.”

DECORATION DESIGN SOLUTIONS, INC. v. AMCOR RIGID PLASTICS USA, INC. (2021) mied · cites it 2× “See Mich. Comp. Laws § 440.2718 (1) ("[T]he agreement may provide for remedies in addition or in substitution for those provided .”

— Mich. Comp. Laws § 440.2718(1) — 1 case

Skyline Steel Corp. v. A.J. Dupuis Co. (1986) mied “§ 440.2718(1). 17 Whether a liquidation provision is unreasonable is a question of law for the court to determine in light of all the circumstances.”

Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.