How to Calculate Liquidated Damages
- 1). Determine any known amounts of money that have clearly been lost by the breach of contract (for example, loss of rent during the time after the apartment's occupant stopped paying rent prior to its being rented by a new occupant). Add these values together.
- 2). List all unknown damages incurred (i.e. profits lost from the failure of a contracted answering service to answer calls). Assign monetary values to each of these damages. These amounts must be reasonable and reflect the realistic monetary value of the losses incurred. Add these values together.
- 3). Add the value you obtained from Step 1 to the value obtained from Step 2. The sum of these values is the total of the liquidated damages.
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