Missouri
How Feld v. Henry S. Levy & Sons, Inc. applies in Missouri: state-specific rules, key cases, and bar exam notes for Other.
Missouri courts recognize the principle established in Feld v. Henry S. Levy & Sons, Inc., particularly regarding the enforcement of liquidated damage clauses and the balance between contractual freedom and public policy. Courts assess the reasonableness of such clauses as well as whether they serve a legitimate business purpose.
In Missouri, a liquidated damages clause is enforceable if (1) it is a reasonable estimate of anticipated damages, (2) it does not constitute a penalty, and (3) it is consistent with public policy.
The court upheld the enforceability of a liquidated damages clause, emphasizing the necessity of fair pre-estimation of losses.
The court ruled that a liquidated damages provision was enforceable because it reflected a genuine attempt to estimate damages.
This case reaffirmed the enforceability of agreements that reflect reasonable foresight of damages, distinguishing them from punitive measures.
Missouri's approach aligns with the federal standard set by the Restatement (Second) of Contracts regarding liquidated damages but emphasizes an additional layer of public policy consideration. While both jurisdictions seek to prevent punitive clauses, Missouri particularly focuses on the reasonableness of the anticipated harm.
Candidates should be familiar with Missouri's enforcement criteria for liquidated damages clauses, as these principles frequently appear in the Missouri bar exam.