Chapter 16 - Question #1 The terms of the contract between...

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Question #1 The terms of the contract between Cohen and Windsor state that 10 percent of the purchase price is to be help by the seller as a deposit towards the purchase. The term further stipulates, if the buyer breaches the contract, Cohen retains a deposit as a liquidated damages. Liquidated damages is a monetary compensation for a loss, detriment, or an injury to a person or a person's rights or property, awarded by a court judgment or by a contract stipulation regarding breach of contract. In our case Windsor breaches the contract because her financing of the $90,000 fails. Cohen sells the house and lot to Ballard for $105,000 in two weeks. He refused to return $10,000 back to Windsor. When he sells the property in no time, the amount of $10,000 is not deemed reasonable to hold anymore, and thus not considered as an actual or anticipated harm caused by the contract breach. Cohen sells the house and lot without any problems for a bigger price.
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This note was uploaded on 03/11/2011 for the course ACC 101 taught by Professor Corolinsky during the Spring '11 term at SUNY Albany.

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