penalty clause

noun

Legal Definition of penalty clause 

1 : a clause (as in a contract) that calls for a penalty to be paid or suffered by a party under specified terms (as in the event of a breach) and that is usually unenforceable

Note: A penalty clause differs from a liquidated damages clause by not being tied to an estimate of possible actual damages.

2 : a clause in a statute or judgment that sets forth a penalty for a specific act or omission (as failure to make a support payment on time)

Learn More about penalty clause

Share penalty clause

Dictionary Entries near penalty clause

penal statute

penal sum

penalty

penalty clause

pend

pendency

pendent

Comments on penalty clause

What made you want to look up penalty clause? Please tell us where you read or heard it (including the quote, if possible).

WORD OF THE DAY

having a pattern of small flowers

Get Word of the Day daily email!

Test Your Vocabulary

Find the Cousins

  • a-large-tree-with-many-branches
  • Which pair shares a common word ancestor?
Spell It

Can you spell these 10 commonly misspelled words?

TAKE THE QUIZ
Syn City

Test Your Knowledge - and learn some interesting things along the way.

TAKE THE QUIZ

Love words? Need even more definitions?

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!