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Subject To Review? Consideration, Liquidated Damages And The Penalty Jurisdiction, Eliza Mik

Research Collection Yong Pung How School Of Law

The paper examines the relationship between what seem to be basic principles in contract law: "consideration need not be adequate" and "the rule against penalties applies only to sums payable on breach." The 'reluctant inspiration' lies in the recent Australian case of Andrews v. Australia and New Zealand Banking Group Ltd, which establishes that the absence of breach or an obligation to avoid the occurrence of an event upon which a sum becomes payable, does not render such sum incapable of being characterized as a penalty. This decision constitutes an unexpected divergence from the position in most other common law …