The "Compensation for Damages" clause outlines the obligations of a party to financially reimburse the other party for losses or harm caused due to a breach of contract or negligent actions. This clause establishes the specific conditions under which compensation is applicable, including the types and extent of damages covered.
ARTICLE 9. COMPENSATION FOR DAMAGES 9.1. The Sublessor will have to compensate the Sublessee in the following cases: (i) Delay in handing over Clean Premises; (ii) Delay in handing over Land Use Rights Certificate; (iii) Failure to ensure adequate electrical infrastructure for use in a stable and continuous condition; (iv) Any action or inaction that hinders, delays, or affects the normal use of the infrastructure by the Sublessee. (V) The Sublessor will assist the Sublessee in completing fire prevention and fighting issues and environmental impact assessment until acceptance is completed. 9.2. The Sublessee will have to compensate the Sublessor in the following cases: (i) Late payment of Raw Land Rent, Infrastructure Rent, Industrial Service Fees and Infrastructure Maintenance; (ii) Well drilling, underground drilling, resource exploitation; (iii) Land encroachment; (iv) Any action or inaction that has an immediate impact and/or creates a risk of long-term impact on the infrastructure of the Industrial Park. 9.3. The violating Party will have to compensate for all damages that can be determined or that can be anticipated and calculated, including: costs of repair and remedy of damage; lost or reduced income; fines and compensation to third Parties; Long-term damage due to reputational damage. In case the violation is an act of the Sublessee and has a long-term impact or impact on the infrastructure of the Industrial Park, the Sublessor is entitled to request an additional compensation for periodic inspection and take measures to prevent risks of infrastructure impact/disruption.
Clause 21 Compensation for Damages to or from Third Party (1) If Tenant, its employee, or other person associated with Tenant inflicts damage on other tenants or general customers in the Building, Tenant must compensate for the said damages, at its own cost and responsibility. (2) When Tenant is inflicted damage by an act of a third party including other tenants, Tenant may not demand any compensation to Lessor.
If the Defaulting Party fails to rectify such Default or take remedial actions within the reasonable period or within ten (10) days after the Observant Party notifies the Defaulting Party in writing requesting the Default to be rectified, and if any Existing Shareholder or the Domestic-funded Company is the Defaulting Party, then the Observant Party is entitled to decide at its own discretion: (1) to terminate this Agreement, and require the Defaulting Party to give full compensation for damages or (2) to require the Defaulting Party to continue to perform its obligations hereunder and give full compensation for damages; if WFOE is the Defaulting Party, the Observant Party has the right to require it to continue to perform its obligations hereunder and give full compensation for damages.
Article 9 (Compensation for Damages) 1. In the event that User and Vender suffer damages due to reasons attributable to the other party in connection with the performance of this Agreement, User and Vender may make a claim against the other party for compensation for damages in accordance with laws and regulations. However, if a claim period is specified in the Exhibit, no claim may be made after the expiration of the period, regardless of the claim period under laws and regulations.
(3) The Obligor shall be subject to compensation for damages in the following cases: 1. The Obligor shall not raise any objection even when the Bank or its designated person exercises the Obligor’s right to claim compensation for damages arising from shortage in quantity, damage or different size of brought-in items due to supplier’s negligence. 2. If the Obligor receives compensation for damages, or if the Bank receives compensation for damages pursuant to the provision of subparagraph 1, the equivalent KRW amount of the compensation for damages shall be deposited to the Deposited Fund account in the name of the Obligor.
6.4. Compensation for damages: Except for the case of Force Majeure or if the Parties agree otherwise, if a Party breaches its obligations and commitments provided in this Agreement, the breached Party has the right to request the breaching Party to compensate for all damages arising (if any) caused by the breaching Party’s acts.
Compensation for damages is a legal concept where a party who has suffered loss or harm due to another’s breach of contract or wrongful act is awarded a monetary sum. This compensation aims to restore the affected party to the position they would have been in had the breach or wrongful act not occurred. It is a fundamental principle in contract and tort law, ensuring fairness and accountability.
You should use compensation for damages in instances where:
When drafting a clause for compensation for damages within a contract or legal document, consider the following structure:
Define the Event: Clearly state what constitutes a breach or a harmful act.
“A breach occurs if Party A fails to deliver the goods by the stipulated date…”
Specify the Damages: Detail what types of losses are eligible for compensation.
“Compensation covers lost profits, direct damages, and additional incurred expenses due to non-delivery…”
Determine the Calculation: Explain how the compensation amount will be calculated.
“The compensation shall be calculated based on the current market value of the goods plus any consequential expenses…”
Include Timeframes and Procedures: Outline the process and timeline for claiming and resolving compensation.
“Claims for compensation must be submitted within 30 days of the breach, with supporting documentation…”
Include Limitations or Caps: If applicable, specify any limitations on the amount of compensation.
“The maximum liability for compensation shall not exceed $50,000 or 10% of the total contract value, whichever is lower…”
Compensation for damages clauses are commonly found in the following types of contracts:
Sales and Purchase Agreements: To cover losses from breaches like late deliveries or defective goods.
Service Contracts: To address non-performance or substandard services provided.
Leases: In case of damage to property or breach of lease terms by the tenant.
Construction Contracts: For delays or defects in construction projects leading to additional costs.
Partnership Agreements: To manage instances of misconduct or breach by partners leading to financial loss.
Each contract will tailor its compensation for damages clause based on specific terms and risks associated with the agreement.
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Dive deeper into the world of clauses and learn more about these other clauses that are used in real contracts.
The compensation clause outlines the payment terms agreed upon between the parties involved in a contract, specifying the amount, schedule, and method of payment for services rendered or work completed. It ensures transparency and sets expectations regarding financial responsibilities and obligations.
A "Competitor" clause in a contract typically restricts one or both parties from engaging in activities or partnerships with specified competitors of the other party for the duration of the agreement, and possibly beyond. This clause is intended to protect a party's market position or sensitive information by limiting competitive conflicts of interest.
The "Complete Agreement" clause, also known as the "Entire Agreement" clause, stipulates that the written contract constitutes the full and final expression of the parties' agreement, precluding any prior or contemporaneous oral or written statements from affecting its terms. This clause aims to prevent any external documents or discussions from altering the agreed-upon terms, ensuring that only the written contract governs the parties' obligations and rights.
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