Legal Definitions - liquidated demand

A liquidated demand refers to a claim for a specific, fixed, or easily calculable sum of money. The amount of the claim is not open to subjective estimation or debate regarding its calculation, although the liability to pay it might still be disputed. Essentially, it's a claim where the exact monetary value is already determined or can be precisely determined by a simple calculation based on agreed facts or terms.

Here are some examples to illustrate this concept:

• Unpaid Invoice for Services:

  Imagine a freelance graphic designer, "DesignPro," completes a logo design project for a client, "Startup Solutions," and sends an invoice for $1,200, which was the agreed-upon fee in their contract. Startup Solutions fails to pay the invoice by the due date.

  Explanation: DesignPro has a liquidated demand for $1,200. The amount is precisely stated on the invoice and was pre-agreed in the contract for the specific services rendered. There is no ambiguity or need for estimation regarding the monetary value of the claim.

• Contractual Late Payment Penalty:

  A commercial lease agreement between a landlord, "City Properties," and a tenant, "Retail Hub," stipulates that if rent is not paid by the fifth of the month, a late fee of $100 will be automatically added to the outstanding balance. Retail Hub pays their rent on the tenth of the month.

  Explanation: City Properties has a liquidated demand for the $100 late fee. The amount is a specific, pre-determined sum clearly outlined in the lease agreement for a defined breach (late payment). Its value is fixed and not subject to further calculation or negotiation once the condition is met.

• Refund for a Defective Product:

  A customer purchases a new smartphone for $999 from an electronics store. Within the warranty period, the phone develops a manufacturing defect, and the customer returns it for a full refund, as per the store's stated return policy.

  Explanation: The customer has a liquidated demand for $999. The amount of the refund is the exact purchase price of the item, which is a fixed and easily ascertainable sum, not subject to negotiation or estimation of damages.