Q&As
Liability for exit costs without express contract terms?
Is there liability for exit assistance costs on termination when there is no express provision in the agreement?
Termination
A termination clause in a contract allows for the agreement to be terminated on the grounds and in the manner specified in the clause. There are four broad grounds:
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termination by notice or agreement. See: Contract termination—overview and Practice Note: Ending a contract by agreement
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breach of the agreement. See Practice Note: Termination for breach of contract
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a party ceasing to conduct business or becoming insolvent. For restrictions on the enforceability of such clauses, see Practice Note: Corporate Insolvency and Governance Act 2020—restrictions on ipso facto clauses
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an force majeure event. See Practice Note: Force majeure—consequences and contract discharge
Exit assistance
The contract may also have an exit or termination assistance clause. This might
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