Penalty clauses

Penalty clauses: are they out of fashion?

Orla Byrne

The High Court has applied the Makdessi test on penalty clauses to the terms of a side letter between a tenant of retail premises and the landlord. In doing so it held that the termination provision in the side letter amounted to an unenforceable penalty. Following Makdessi, when considering whether a clause is a penalty, the first Read More

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It’s a penalty! Isn’t it? Penalty clauses since Makdessi

Daniel Grimwood

In November 2015 the UK Supreme Court restated the test for penalty clauses in Cavendish v Makdessi. One year on, how is the test being applied by the courts? There has been much debate around whether provisions are primary or secondary obligations. Members of the court in Makdessi did not agree on this point on Read More

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