A contract termination letter provides formal notification of the decision of a party to terminate or cancel an agreement. Business contracts that are delivered on an ongoing basis need to be... ... Read more
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How to Make a Letter Ending a Contract
A contract termination letter provides formal notification of the decision of a party to terminate or cancel an agreement. Business contracts that are delivered on an ongoing basis need to be terminated correctly to avoid any disputes. Whether the contract involves regular delivery of goods, the supply of services or another open-ended business relationship, it is vital that proper notification is given of a decision to bring the business arrangement to a close.
Make sure you follow proper procedure when you wish to bring a contract to an end with this contract termination letter. This letter to end a contract is required to notify the other contracting party when you wish to end a contract immediately or by notice. Preparing this letter will help ensure that unnecessary damages won't be brought against you by the other party to the contract. This contract termination letter covers the type of notice used and the period of time before the notice takes effect.
Use this letter ending a contract to:
This letter ending a contract covers the:
Preparing a formal letter ending a contract and delivering this to your supplier or purchaser ensures that the process of terminating the contractual business relationship is properly documented. This documentation serves as valuable proof that the correct notice period (if required) was given and helps to avoid any potential disagreements. It can also be used if a contract needs to be brought to an end immediately (eg due to a serious breach of contract).
Aside from definitively ending a contract, a letter ending a contract can be used to provide notice if there is a problem (eg poor performance if services are being supplied under the contract); it gives the other business an opportunity to put things right by a certain date if they wish to avoid termination of the contract.
There are a variety of possible reasons that a contract between two businesses might come to an end, including:
The amount of notice which needs to be given will generally depend on the terms contained in any written contract. If there are no express terms regarding notice periods, or in the absence of a formal agreement, it is implied that 'reasonable notice' should be given. The meaning of what constitutes 'reasonable notice' will depend on factors such as:
Certain material breaches of the contract (eg complete failure to deliver goods or services, or to pay an invoice within a reasonable amount of time) may give rise to the termination of the contract without notice.
Some contracts provide that, where there has been a minor breach, the offending party is given a chance to rectify the problem. In this case, a letter ending a contract can allow for the termination to be cancelled if the issue in question is satisfactorily addressed by a certain date.
Last reviewed or updated 17/06/2022
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