When entering into a contract (like with any
relationship), no one expects it to go pear shaped and end in
tears. So, what happens when the awkward silences and name calling
are all too much and it's time to cut your losses and get
Terminating a contract is pretty straightforward when your
contract has clear termination provisions. But we get it, there are
times when in the heat of the moment no contract was signed, or
perhaps what you did sign was pretty basic and had no termination
clauses. Stop stressing; all hope is not lost. Here are a couple of
Option 1: Breach
First thing to work out is if there has been a breach of the
contract by the other side. If so, then we may have just solved
your problem. In order to terminate for this reason, the breach
must be of an essential term (which is a really important one, e.g.
to pay the fees) or be a sufficiently serious breach of a
non essential term (which is a less important term, e.g. to deliver
the goods by a certain time). This is actually a pretty tricky
distinction to determine, and shouldn't be made by your mate
who thinks watching The Good Wife religiously is as good
as getting a degree in law.
Option 2: Notice
If there hasn't been a breach, how about you do it maturely
and tell the other side that it's over. A post–it-note
à la Berger to
Carrie won't cut it. Terminating a contract without reason
where there is no fixed term or any rights to terminate is a tricky
one, and the Courts have said that you need to give a reasonable
period of notice. What is a reasonable period will depend on a
number of factors including:
any hints in the agreement as to how long the relationship
time periods to provide whatever it is you agreed to provide (a
cruise ship takes longer to build than a macramé
any prior contracts between you;
industry standards; and
any investments made by the parties on the assumption that the
contract will remain in place.
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On 12th November 2016, new laws will commence to protect small businesses from unfair terms in standard form contracts.
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