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1) i am not licensed in oklahoma, so anything that comes after this is not an actionable legal opinion, but just the random musings of a dude on the internet.***ARISE FROM THE DEAD***
Butthurt could you possible give me a plain text reading of this Oklahoma contracts statute?
Every contract, by which the amount of damages to be paid, or other compensation to be made, for a breach of an obligation, is determined in anticipation thereof, is to that extent void, except as expressly provided by Section 215 of this title.
2023 Oklahoma Statutes :: Title 15. Contracts :: §15-214. Attempt to fix damages void except as provided.
Justia Free Databases of US Laws, Codes & Statuteslaw.justia.com
Does this say that if the damages are determined ahead of knowing the cost of a set of repairs then the contract is void?
For instance, if a contractor says they will repair a house for X amount of money to be determined in the future, but if you back out of the contract you owe 15% of X in liquidated damages then a contract stating that would be void?
AI thinks I am right. It's Microsoft, though, so I don't trust it.
You
Can you tell me what Oklahoma Statute 15 Section 214 says?
Copilot
Oklahoma Statute 15 Section 214 states that every contract, by which the amount of damages to be paid, or other compensation to be made, for a breach of an obligation, is determined in anticipation thereof, is to that extent void, except as expressly provided by Section 215 of this title1234. This means that any provision in a contract that attempts to predetermine the damages for a future breach of the contract is generally not enforceable, unless it is specifically allowed under Section 215. Please consult with a legal professional for a more detailed understanding.
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1law.justia.com2casetext.com3bing.com4casetext.com
You
Can you provide an example of this ?
Copilot
Sure, let’s consider a hypothetical scenario:
Suppose you’re a software developer and you sign a contract with a company to deliver a software project within 6 months. The contract includes a clause that states if you fail to deliver the project on time, you will have to pay a predetermined amount of $50,000 as damages to the company.
Now, according to Oklahoma Statute 15 Section 214, this clause is generally unenforceable because it attempts to predetermine the damages for a potential future breach of the contract. The actual damages the company might incur due to the delay could be more or less than $50,000, and it’s not appropriate to decide this amount in advance.
However, there are exceptions under Section 215 where such a clause might be enforceable. It’s always recommended to consult with a legal professional for a more detailed understanding and application of these laws.
You
would it still apply to your hypothetical if the predetermined amount was a percentage of an unknown future value?
Copilot
Yes, the principle would still apply. If a contract includes a clause that determines in advance the damages for a potential future breach as a percentage of an unknown future value, it would generally be unenforceable under Oklahoma Statute 15 Section 214.
For example, if the contract states that you would have to pay 20% of the project’s future profits as damages if you fail to deliver on time, this clause would typically be unenforceable. The reason is the same: it attempts to predetermine the damages for a potential future breach of the contract.
However, as always, there could be exceptions under Section 215, and the specific circumstances of the case can also influence the outcome. Therefore, it’s recommended to consult with a legal professional for a more detailed understanding and application of these laws.
2) It sounds to me like you cant have a liquidated damages clause under that provision. In some circumstances, you can contract ahead of time and say “if you breach this agreement in anyway, you must pay me X dollars,” and that provision suggests such clauses are void.
The statute says also, “except as provided by section 215.” 215 appears to have a host of exceptions authorizing liquidated damages clauses in certain circumstances.
thats my best guess, but i’d recommend that you consult with an attorney in Oklahoma for clarification.
FYI: this is what makes practice of law dangerous. There are 50+ american jurisdictions, and lay persons are like, bro’s a lawyer he knows about all of them. Not True.
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