Kimbrough & Co. v. Schmitt

HIGHERS, Judge.

The principal issue in this case is whether a liquidated damages provision in a contract for deed was properly struck down in the court below.

I. Facts

In 1988, Lawrence Schmitt, appellee, contracted to buy residential property located at 6511 Rocky Park in Memphis, Tennessee, from Kimbrough & Co. for $72,450.00. The terms of the contract provided that the financing period would expire at the end of three years. Three years following the execution of the contract, the parties agreed to renew the contract based on the then-existing sales price of $71,658.57. Schmitt made payments…