Legal Definitions - civil penalty

A civil penalty is a punishment imposed on a wrongdoer for violating a statute or regulation. It is usually in the form of a fine, but can also include other charges or damages.

• The Environmental Protection Agency (EPA) levied a civil penalty of $10,000 on a manufacturer for exceeding its pollution limits.
• A borrower who pays off a loan before it is due may be charged a prepayment penalty.
• Some contracts include penalty clauses that impose excessive damages on a party that breaches the contract.

These examples illustrate how civil penalties can be imposed for various types of violations, including environmental regulations, loan agreements, and contracts. The penalties are intended to deter future violations and compensate for any harm caused by the wrongdoing.