corporation is determined to be de facto
liquidated (assume in this discussion that a wholly owned U.
If a company is
liquidated because of the expiry of the duration of the company, the General Meeting, at least 3 months before such expiry, must adopt the decision to liquidate the company and elect the liquidator, or adopt the decision to extend the duration and amend the Articles of Association of the company.
Why include a
liquidated damages clause in a restrictive covenant?
Therefore,
liquidated damages should be a reasonable estimate of actual damages.
It is important that the owner exercise good judgment when determining the number of months to be covered under
liquidated damages, based on actual experience relating to construction delays.
What are the advantages and disadvantages of
liquidated damages?
Trinity's standard form lease, which apparently was not subject to negotiation, required each tenant to deposit one month's rent, which it then held as
liquidated damages in the event the tenant moved out before the lease ended.
It is also remarkable for its enforcement of a penal
liquidated damages provision that doubled the firm's actual fees.
TRA 86 made the retention of a
liquidated corporation far more attractive than before.
In our example above, the tenant might agree to pay the owner, as
liquidated damages, and in addition to the minimum rent payable under the lease, an amount equal to 50 percent of the per diem minimum rent payable under the lease for each day after the outside date that the tenant's store is not open.
Liquidated damage clauses may also be subject to attack.
Property received by the
liquidated member has a basis equal to the basis in the partnership interest, reduced by cash received in the liquidation.
A "time is of the essence clause"-In contracts where the
liquidated damages clause is invalid, the courts will allow an owner to invoke this clause to recover damages, provided the property owner can demonstrate an accurate calculation of consequential damages.
Supreme Court recently said
liquidated damages stemming from an age discrimination claim filed under the Age Discrimination in Employment Act (ADEA) are not tax-free.
