Liquidated Damages

Liquidated damages (LDs) are a fixed sum, agreed in advance and written into the construction contract, that a contractor must pay for each day a project runs past its completion deadline. They set a predetermined cost of delay rather than leaving it to be argued later.

The figure is meant to be a genuine estimate of the owner's loss from late completion — lost rent, extended financing, continued overhead — not a punishment. Courts generally enforce them when the amount is reasonable and actual damages would be hard to calculate.

Because liquidated damages turn schedule slippage directly into money, the schedule and the estimate behind it carry real financial weight. Building a realistic timeline and cost basis up front is part of preconstruction discipline — the kind of groundwork Quotr supports.

For contractors, liquidated damages make finishing on time a direct financial obligation. For owners, they convert the risk of delay into a defined, recoverable cost.