What are the consequences of a penalty clause in a personal injury case?

Alberta, Canada


The following excerpt is from Deer Valley Shopping Centre Ltd. v. Sniderman Radio Sales & Services Ltd., 1989 CanLII 3185 (AB QB):

If the clause if found to be a penalty, only the actual proven damages up to the agreed upon amount will be recoverable: Elsley v. Collins Ins. Agencies, supra.

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