Damage Clause

What is damage clause?

Damage clause is a very effective means by which you can recover the loss that has occurred due to breach of the agreement. Generally these clauses are found in situations that are ever changing and therefore the damages that may occur are hard to determine before they actually occur. These clauses are generally the part of transactions that take place in real estate. The terms of the contract are determined and if one fails to abide by the terms the parties agree to pay a specific amount to the other signing party.

Benefit of signing the damages clause

The benefit of signing the damages clause goes to all the parties signing it. It is actually a kind of insurance for both the parties. Both the parties are aware of the fact that a definite sum must be ready with them if at all they are to break the agreement.

The other party that has suffered the loss can also get an opportunity to assess their losses and then determine the amount that will compensate for the same.

The matter can be solved without having to file time consuming court case which is a very expensive way out for both the parties.

The purpose of damage clause

The purpose of damage clause in no way is to punish the party that has breached the agreement, instead it for the welfare of the party that suffered the loss due to the breach of agreement by getting the monetary compensation to the party at loss.

Damage Clause

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Sample Template Preview

Exhibit “C”
Responsibility for Damages

This exhibit is part of the Independent Contractor Services Agreement dated the ___________day of ____________, 20___, between _____________________, as Customer, and _________________________, as Contractor thereof.

Contractor shall be responsible for any damage caused to existing conditions. This shall include new work performed on the job site by other contractors. If the Contractor damages existing conditions or work performed by other contractors, said Contractor shall be responsible for the repair of said damages. These repairs may be made by the Contractor responsible for the damages or another contractor, at the discretion of the Customer.

If a different contractor repairs the damage, the Contractor causing the damage may be back-charged for the cost of the repairs. These charges may be deducted from any moneys owed to the damaging Contractor, by the general contractor. The choice for a contractor to repair the damages shall be the sole discretion of the Customer.

If no money is owed to the damaging Contractor, said Contractor shall pay the invoiced amount, from the Customer, within seven business days. If prompt payment is not made, the Customer may exercise all legal means to collect the requested moneys.

The damaging Contractor shall have no rights to lien the property where work is done for money retained to cover the repair of damages caused by the Contractor. The customer may have the repairs made to his or her satisfaction.

The damaging Contractor shall have the opportunity to quote a price for the repairs. The Customer is under no obligation to engage the damaging Contractor to make the repairs.

________________________________                _____________
Customer                                Date

________________________________                _____________
Contractor                                Date