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Is Caterer Entitled to More than Deposit if Event Cancelled?

Question Originally Appearing on AVVO

“How do you compute 25% of this cake?”

Question (from anonymous in Florida):

“I signed a contract that said a 25% deposit would be non refundable for a catering event.: I paid over the 25% non refundable deposit and then cancelled my event. The vendor states now that any additional monies paid is also forfeited. Should it have to be stated separately from the deposit in the contract? Is this right?”

Response (from Attorney Rob Schenk):

Should the contract explicitly provide that 25% of the contract price is kept in the event of cancellation, then that would be all that the caterer is entitled to. These types of clauses, in which a specified amount is kept, are referred to as liquidated damages clauses (LDC). Generally, the non-breaching party (the caterer) is ONLY entitled to the LDC amount, even if that party has other damages from the cancellation (for example, the caterer has already bought the food) which are higher than the LDC amount.

But, it will all depend on the exact wording of the contract.

Good luck!

Moral of the Story: Wedding Vendors, particularly caterers, must have explicit terms on what money is kept in the event of cancellation. Otherwise, you may be shooting yourself in the foot.

About 

Rob Schenk is one of the country’s most prominent “Wedding Lawyers,” a special designation for trial lawyers representing wedding and event industry professionals involved in business disputes and in transactional matters.
Rob was awarded Rising Star of 2015, 2016, and 2017 by Super Lawyers, an honor bestowed on only 2.5% of attorneys. Rob has previously been recognized by his colleagues with a Martindale-Hubbell’s AV Preeminent Rating. Rob is licensed to practice law in Georgia, Tennessee, Florida, California, and New York.

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