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by 7Figures2Commas
3873 days ago
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> If the lessee is willing to pay the penalty, what's the problem? If the penalty isn't sufficient to deter the unwanted behavior, increase it until it is. You are ignoring the practical realities of landlord-tenant relationships. Let's say you rent an apartment from me and I add a liquidated damages clause to the lease. It states that you will owe me $50,000 if you are found to be subletting your apartment using a service like AirBnB. Unless you have $50,000, the liquidated damages clause is effectively worthless and you can easily choose to break the lease ("my landlord can't get blood from a stone"). If I increase the liquidated damages to $100,000, the deterrent effect likely doesn't increase. |
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