91 A.D.2d 542 | N.Y. App. Div. | 1982
— Judgment, Supreme Court, New York County (Evans, J.), entered July 30,1982 denying petition to stay arbitration of Claim No. 2 in respondent’s demand to arbitrate is affirmed, with costs. Although the formula for fixing damages is styled a penalty in the agreement between the parties, that designation is not dispositive. (See Truck Rent-A-Center v Puritan Farms 2nd, 41 NY2d 420, 425.) When the provision is considered in light of the facts established in this record, it is apparent that the formula represented a reasonable estimate by the parties at the time they entered into their agreement for fixing the injury that would be sustained as a result of a breach. Accordingly, we agree with Special Term that the provision in question was one for “liquidated damages”, and does not violate public policy. Concur — Sandler, J. P., Carro, Lynch and Milonas, JJ.
