H.J. McGrath Co. v. Wisner
Maryland Court of Appeals
55 A.2d 793 (1947)
Relevant factsFree
Wisner (plaintiff) agreed to sell his entire 1944 tomato crop to H.J. McGrath Co. (defendant) at a set price, with a clause fixing $300 in liquidated damages if he failed to deliver his whole crop. When Wisner didn't deliver everything, the Company withheld $300 from its payment to him; Wisner sued for that amount, and the Company defended by asserting the clause was valid liquidated damages rather than an unenforceable penalty.
IssueFree
Whether a contractual liquidated-damages provision that penalizes a breaching party can be enforced.