Guthman v. Moss

Opinion

THOMPSON, J.

In this case we are called upon to determine whether a clause in which a buyer of residential real property agrees to pay liquidated damages is unenforceable as a matter of law when the clause is not separately signed or initialed by buyer and seller pursuant to California Civil Code 1 section 1677.

While the Legislature has not provided any express guidelines for the enforceability of a clause which fails to meet the formal requirements in that section, we hold that the Legislature did not intend such clauses to be rendered unenforceable as a matter of law. We further hold…