Penalty

A punitive measure that the law imposes for the performance of an act that is proscribed, or for the failure to perform a required act.

Penalty is a comprehensive term with many different meanings. It entails the concept of punishment—either corporal or pecuniary, civil or criminal—although its meaning is usually confined to pecuniary punishment. The law can impose a penalty, and a private contract can provide for its assessment. Pecuniary penalties are frequently negotiated in construction contracts, in the event that the project is not completed by the specified date.