Gobble v. Linder

Citations

• 76 Ill. 157

Syllabus

<p>1. Liquidated damages—intention determines whether provision is for, or is a penalty. The question whether the sum named in an agreement to secure performance will be treated as liquidated damages or as a penalty, is to be determined in accordance with the intention of the contracting parties.</p> <p>3. Same—rule for determining. Where the parties to an agreement have expressly declared the sum to be intended as a forfeiture or penalty, and no other intent is to be collected from the instrument, it will generally be so treated, and the recovery will be limited to the damages sustained by the breach of the covenant it was to secure.</p> <p>3. On the other hand, it will be inferred the parties intended the sum named, as liquidated damages,- when the damages arising from the breach are uncertain, and are not capable of being ascertained by any satisfactory and known rule, or where, from the nature of the case and the tenor of the agreement, it is apparent the damages have already been the subject of actual and fair calculation and adjustment.</p> <p>4. Where the agreement is in the alternative to do some particular thing or pay a given sum of money, the court will hold the party failing, to have had his election, and compel him to pay the money.</p> <p>5. Same—agreement to exchange farms. Where a written contract for the exchange of farms provided that in case either party failed to make the deed in exchange at the appointed time, such party would “ forfeit and pay as damages” to the other the sum of $1500: Held, that in view of the nature of the contract, the difficulty of proving the actual damages, and from the words used, the sum named was to be regarded as liquidated damages, and recoverable on a breach of the agreement.</p>