SUM CERTAIN

any amount that is fixed, settled, stated or exact. It may refer to the value of a negotiable instrument, to a price stated in a contract, or to a measure of damages. The sum must be ascertainable at the time the instrument is made and computable solely from examination of it. EXAMPLE: A long-term contract includes a very technical formula for determining the cost of wheat. The formula allows for fluctuations in the market place, weather, demand and other factors. Although the price can therefore vary each time a price is paid, the fact that there is a formula means that the contract includes a sum certain. Source: Barron's Dictionary of Legal Terms, Steven H. Gifis, 5th Edition; © 2016