Limiting liability with liquidated damages clauses: J-Corp Pty Ltd v Mladenis [2009] WASCA 157

Building and construction contracts often include a clause providing for the proprietor to be paid an agreed rate of liquidated damages in the event the contractor fails to meet milestones by the time prescribed by the contract. To be enforceable, the liquidated damages must represent a genuine pre-estimate of a proprietor’s loss. Liquidated damages clauses are normally included for the proprietor’s benefit.