Difference Between Penalty and Fine

Laws and contracts are made with the intention of binding parties involved to certain conditions. If these are not met, the repercussions are either penalties or fines. While these two are used synonymously, they have clear differences, as outlined below.

What is a Penalty?

Used in criminal and civil law, penalties are punishments imposed as a result of breaking laws, contracts or rules. The punishments imposed may be in physical and monetary forms, and are imposed either for the performance of an act or failure to perform an act.

In civil law, however, penalties are imposed on contracts. Parties who fail to fulfill set conditions as per contract agreements are ordered to pay the penalties in form of damages. Where property is involved, the accused may lose legal rights attached to the property as ordered by a court of law. 

What is a Fine?

This is a form of monetary punishment for a crime or offense committed. Common in criminal law context, fines are used in instances involving minor crimes such as traffic violations. For instance, a person who exceeds driving speed limits is subjected to a fine. Other instances include settlement of claims against the accused person.

Although fines are monetary punishments, they may be imposed alongside trials, community service, and imprisonment. The amount paid as a fine is determined by the type of offense and state laws.

Similarities between Penalty and Fine

• Both are used in the context of laws and agreements

Differences between Penalty and Fine

Definition

A penalty refers to a punishments imposed as a result of breaking laws, contracts or rules. On the other hand, a fine refers to a form of monetary punishment for a crime or offense committed.

Application

While penalties are applied in both criminal and civil law, fines are applied in criminal law.

Forms of punishment

Forms of punishments in penalties include payment of damages, loss of legal rights attached to the property and even imprisonment. On the other hand, forms of punishments in fines include monetary payments that may be imposed alongside trials, community service, and imprisonment.

Penalty vs. Fine: Comparison Table

Summary of Penalty vs. Fine

A penalty refers to a punishments imposed as a result of breaking laws, contracts or rules. It is applied in both criminal and civil law, with forms of punishments including the payment of damages, loss of legal rights attached to the property and even imprisonment.

On the other hand, a fine refers to a form of monetary punishment for a crime or offense committed. It is applied in criminal law, with forms of punishments including monetary payments that may be imposed alongside trials, community service, and imprisonment. Both, however, remain important concepts in the maintenance of law and order.

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