The Minnesota Supreme Court recently clarified the application of the doctrine against disproportionate forfeiture under Minnesota contract law in Capistrant v. Lifetouch Nat’l Sch. Studios, Inc., 916 N.W.2d 23 (Minn. 2018). Minnesota courts (and other jurisdictions) have long relied on the disproportionate forfeiture doctrine as a way to prevent inequitable penalties in contracts, although the doctrine is not uniformly interpreted. In Capistrant, while the court confronted the specific question of “whether a former employee’s delay in returning his employer’s property excuses the employer from paying a commission otherwise due to the employee,” its interpretation of the disproportionate forfeiture doctrine may have wider application.
Continue Reading Minnesota Supreme Court Clarifies The Disproportionate Forfeiture Doctrine