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Contracts Keyed to Summers
Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc.
Facts
Puritan Farms 2nd, Inc. (Defendant) leased twenty-five new milk delivery trucks from Truck Rent-A-Center, Inc. (Plaintiff). Plaintiff was to service the trucks and Defendant was to make weekly payments. The lease included a liquidated damages provision stating that, upon Defendant’s breach, Plaintiff would be entitled to one-half of all the remaining rental payments due under the contract. In deciding upon this measure of damages, the parties contemplated Plaintiff’s substantial investment in purchasing the trucks, the uncertainty surrounding Plaintiff’s ability to re-rent or sell the trucks, and other costs incidental to a breach. After three years, Defendant terminated the lease agreement and returned the trucks to Plaintiff. Plaintiff sued Defendant to collect payment of the liquidated damages. The trial court found that Defendant had breached the agreement and that the liquidated damages provision was enforceable. The trial court calculated the liquidated damages to equal $88,677.60. The court of appeals affirmed. Defendant appealed.
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