Tutorial preparations:

Cite case law for your explanation

https://www.e-lawresources.co.uk/Offer-and-acceptance4.php

Question 2

Jennifer has recently signed a contract with a renovation contractor called Beautiful

Homes ("BH"), to renovate her existing apartment for a total sum of $30,000, which is

payable on completion. As Jennifer wanted to make sure that BH would carry out the

renovation works in a timely manner, she included a clause in the contract that states as

follows:

"Clause 23: The renovation

works must be completed within two years from the

date of this

contract. If Beautiful Homes

("BH")

fails to do so, BH

shall pay

Jennifer a penalty lump sum of $10,000."

(a)

Analyse

Clause 23 with reference to the common law guidelines relating to

liquidated damages, and conclude whether Clause 23 is likely to be enforceable

by Jennifer in the event th

at BH fails to complete the renovation works on time.

(19 marks)

(b)

Assume that Jennifer has not yet signed the contract, and has come to you for

advice on Clause 23. Give

two (2)

suggestions to Jennifer on changes that you

would propose to Clause 23 to make it more likely to be enforceable, and provide

brief reasons for your suggestions.

(Your suggestions should be based on contract

law principles.)

(6 marks)