Liquidated damages vs penalty: enforceability depends on genuine pre estimate and reasonable relation to anticipated loss. A stipulated contractual sum is enforceable as liquidated damages if it is a genuine pre estimate of anticipated loss and bears a reasonable relationship to the harm, particularly where damages are difficult to calculate; conversely, a sum that is out of proportion and operates as security for performance is a penalty and unenforceable on public policy grounds, with the burden of proving penalty resting on the party resisting enforcement.