Tag Archives: liquidated and ascertained damages

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Considering liquidated and ascertained damages on an agreement for lease

It is sometimes the case that a tenant will enter into agreements for lease where the landlord is undertaking substantial works to, or even constructing, the building or estate within which the premises will be located so that grant of the lease is conditional upon completion of those works.

Liquidated and ascertained damages (LADs) clauses stipulate that a specified sum of money will be payable by one party to the other where there has been a particular breach of contract. Under contract law, if a person agrees to perform certain acts (here, the landlord’s works) for another person (the tenant), in return for a benefit (payment of rent), disputes could arise if the tenant is dissatisfied with the way the landlord performs the works.

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