The appellant (defendant at trial) appealed a Small Claims Court decision enforcing an early termination liquidated damages clause in a service contract with the respondent.
The appellant argued the clause, which required payment of 50 percent of the remaining contract value, was unreasonable.
The Superior Court of Justice dismissed the appeal, holding that the trial judge correctly applied the law.
The court affirmed that liquidated damages clauses are presumed enforceable and the onus rests on the party challenging the clause to demonstrate it is oppressive or unreasonable, which the appellant failed to do.
