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City of Brookhavenv.Multiplex, LLC

CourtCourt of Appeals of Georgia
Docket No.A23A0843
DecidedJuly 27, 2023
Reporter369 Ga. App. 9, 891 S.E.2d 60 (2023)
JudgesBarnes, P. J., Land, and Watkins, JJ.; Land, J., delivered the opinion.
Tags
CivilContract LawLiquidated DamagesConstruction DelayMunicipal ContractNotice to ProceedSummary Judgment
Case Summary

Brookhaven hired Multiplex to build a replacement park under a contract whose scope-of-work addendum set liquidated damages of $1,000 per day for delays beyond 180 days from notice to proceed; the City never issued a written notice, and the park was substantially completed in September 2018. The City sought $271,000 for 271 days of delay, and the trial court granted Multiplex summary judgment on that claim while denying the City’s cross-motion on Multiplex’s counterclaims. Georgia enforces liquidated damages only when actual loss is difficult to estimate, the parties intended compensation rather than a penalty, and the sum reasonably estimates probable loss. The City acknowledged that the daily charge was meant to deter delay and that $1,000 was a standard amount, not calculated for this project. The record also lacked evidence that the City estimated probable losses before contracting. The Court of Appeals held the clause an unenforceable penalty and affirmed both challenged rulings.

Opinion

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