(1) The parties may determine in advance the amount of damages payable in the event of the non-performance of an obligation.
(2) Where the amount of damages determined in advance is unduly excessive, the court may reduce the amount to a more reasonable and appropriate sum.
(3) The determination in advance of the amount of damages shall not affect the obligee's demand for performance or rescission of the contract.
(4) The agreement of a penalty is presumed to be determined in advance of the amount of damages.
(5) Even where the parties have agreed beforehand that something other than money shall be applied as compensation for damages, the provisions of the preceding paragraphs shall apply mutatis mutandis.