Q&As

What are the execution requirements for a termination notice?

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Published on LexisPSL on 17/06/2019

The following Commercial Q&A provides comprehensive and up to date legal information covering:

  • What are the execution requirements for a termination notice?
  • Early termination
  • Termination for convenience on notice
  • Serving notice
  • Termination by a company
  • Termination on behalf of a company

Early termination

There are numerous different circumstances that may lead a party to wish to terminate an agreement early (eg for convenience on notice, non-payment, breach or insolvency). Different considerations will apply depending on these circumstances.

For general guidance on termination, see Practice Notes: Termination and expiry of contracts and How to terminate an agreement.

Termination for convenience on notice

It is quite common for parties to negotiate terms that stipulate when an agreement may terminate. It is important that a party is aware of the contractual rights and powers that are set out in the agreement entitling one party to terminate and the specific requirements of serving notice. A ‘notices’ clause provides the means by which parties to a contract formally communicate with each other under the contract. The inclusion of a notices clause in a commercial agreement allows the parties to provide for an agreed means of sending formal notices to one another, rather than relying on statutory provisions which may otherwise apply. See Practice Note: Notices—commercial contracts.

Where an agreement provides for termination on notice, such notice must be given in accordance with the terms of the agreement (see, for example, Hartnell v Berker Sportcraft). Usually, notice will be subject to the expiry of a specified period such as 14 days, 30 days or three months, with the contract terminating at the expiry of that notice

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