Also known as: poenae · poenam · penalty · punishment
Written by attorneys · grounded in primary & secondary sources — see below
A punishment or penalty imposed for a violation or breach.
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Philip Powell prepaid the full balance on his mortgage held by Peak Performance. The note imposed a prepayment premium that Powell paid to obtain release of the lien. The premium operated as the poena for early satisfaction of the debt.
Preston Pratt failed to make the required charitable contribution under the Charitable Support Act. The statute added the noncontributor amount to his income tax liability and collected it through the federal tax system. The exaction functioned as a poena that Congress could impose under its taxing power.
Pierre Poulin testified at trial inconsistently with his earlier deposition given under penalty of perjury. The prior statement was offered against him. The deposition operated as the poena-backed statement that removed the hearsay bar.
Patricia Patel breached her contract with Pulse Media. The agreement fixed damages at an amount far exceeding the anticipated loss. The clause was unenforceable because it imposed an unreasonable poena rather than a valid liquidation of damages.
Pablo Perez breached his sales contract with Precision Tools. The agreement set damages at a sum unrelated to actual harm or proof difficulties. The term fixing the amount was void as a poena under the UCC rule.
Paige Porter, a general partner in Phoenix Technologies LP, committed a wrongful act in the ordinary course of partnership business. The limited partnership became liable for the resulting loss or poena incurred by the injured party.
A court examines the practical operation of the charge rather than its label. Features such as collection through the income tax system, variation with income or revenue, and revenue-raising purpose indicate tax treatment even when Congress uses the word penalty.
A clause fixing damages is unenforceable when the amount is unreasonable in light of anticipated or actual loss and the difficulties of proof. Both the Restatement and UCC treat an unreasonably large sum as a penalty void on public policy grounds.
A limited partnership is liable for a penalty incurred as a result of a wrongful act or omission of a general partner acting in the ordinary course of partnership activities or with actual or apparent authority.
…he shall be confined in the penitentiary not less than two nor more than five years; if it be done without her consent, the punishment shall be doubled. By abortion' is meant that the life of the fetus or embryo shall be destroyed in the woman's womb or that a premature birth thereof be caused. "Art. 1192. Furnishing the…