Court of Appeals of Maryland
55 A.2d 793 (1947)
On March 7, 1944, G. Herbert Wisner (plaintiff) agreed to sell to H.J. McGrath Co. (Company) (defendant) his entire tomato crop grown during the season of 1944 at $28.00 per ton. Clause 12 of the agreement provided that, if Wisner failed to deliver the entirety of his tomato crop, he would be required to pay $300.00 in liquidated damages. Wisner did not deliver his entire crop of tomatoes as required. In response, the Company deducted $300.00 from its payment to Wisner. Wisner brought suit in the Circuit Court for Baltimore County, seeking the balance of $300.00. The Company made a special plea of set-off. Wisner filed a demurrer to the special plea, which was sustained. The case was then removed to the Superior Court for Baltimore City, and a judgment was entered for Wisner in the amount of $300.00. The Company appealed, arguing that its plea of set-off was proper because Clause 12 of the agreement provided for liquidated damages and did not constitute a penalty.
Rule of Law
Holding and Reasoning (Henderson, J.)
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