Parties to commercial contracts may wish to exit their contractual arrangements for all sorts of reasons. In many cases, they will have included in their contract a right to terminate in particular circumstances, and a process for doing so. Even where there is no express right to terminate, parties may be entitled to terminate under the general law for a counterparty’s breach.
But termination is a drastic step and should never be taken lightly. If a party gets it wrong, it may itself be in breach of contract, giving the counterparty a right to terminate or claim damages or both.
In this eighth of our updated and relaunched series of contract disputes practical guides, Tom Leech QC, James Doe and Robert Moore consider when a contract may be terminated and the implications of termination, and provide some practical tips for commercial parties.
We will be publishing further editions of the updated series of contract disputes practical guides in the coming months. In the meantime, the first seven editions in our relaunched series, and the remaining editions from the original series, can be accessed from the home page for our contract disputes series (which is also linked under “our guides” in the top menu).