Void but Still Binding – Can Unenforceable or Void Liquidated Damages Cap a Claim for General Damages?

David Inns and Derek Yixin

October 2024

A paper presented to the Society of Construction Law at a meeting in London on 7 February 2023

The paper considers liquidated damages clauses, following the clarifications on their operation by the Supreme Court in Makdessi and Triple Point in the last decade. Questions remain about the scope of LD clauses in certain situations. In particular, two TCC decisions examined the language of the LD clauses on the basis of principles of contractual interpretation in determining whether an LD clause could survive as a parallel limitation of liability, and then came to different conclusions. The paper examines whether the two decisions – Eco World and Buckingham – can be reconciled and, if not, whether any helpful guidance can be found in construction commentaries or decisions from this or other jurisdictions, such as Canada and Singapore.

Introduction – Competing approaches – Irreconcilable differences? – Competing contractual interpretations – Wider principles? – Practical Guidance

The authors: David Inns and Derek Yixin are associates at White & Case LLP

Text: 20 pages