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PRECEDENTS
Dear [insert name of authorised recipient on behalf of counterparty], [Insert name of agreement]: [insert client name] and [insert counter-party name] 1 [As you are aware, we OR We act] for [insert client name] (our client). 2 Our client and [insert counter-party name] ([insert short name]) are parties to a [insert agreement name] dated [insert date] (Agreement). 3 We
PRECEDENTS
Dear [insert name of authorised recipient on behalf of counterparty], [insert name of agreement]: [insert client name] and [insert counter-party name] 1 [As you are aware, we OR We act] for [insert client name] (our client). 2 Our client and [insert counter-party name] ([insert short name]) are parties to a [insert agreement name] dated [insert date] (Agreement). 3 We are instructed that [insert counter-party
PRECEDENTS
Dear [insert name of authorised recipient on behalf of counterparty], [insert name of agreement]: [insert client name] and [insert counter-party name] 1 [As you are aware, we act OR We act] for [insert client name] (our client).
PRECEDENTS
Termination notice [To] [Date] By [Email, Fax and First Class Pre-Paid Post] Dear [insert name of contractor/sub-contractor] Contract between [insert name] and [insert name] for [insert description of works] at [insert address] dated [insert address] [with order number OR reference number] [insert any applicable contract order number or reference
PRACTICE NOTES
A note on terminology The Law of Property Act 1925 (LPA 1925) enables a mortgagee of a legal mortgage to appoint an LPA receiver: • when the mortgage moneys become due, and • after making a demand for payment under the terms of the mortgage This right may alternatively (and more usually will) arise under the terms of the charge. In both cases the receiver may be referred to as a fixed charge receiver (in the latter case the receiver is not an LPA receiver, but in practice is often still referred to by this name). Lack of statutory provision There is no statutory provision that deals with the termination of an LPA/fixed charge receivership. As the power to appoint an LPA/fixed charge receiver derives from the legal charge, once the legal charge has been discharged the receiver’s role ceases and they have no more powers. However, a mortgagee can remove an LPA/fixed charge receiver and appoint a replacement by way of deed of appointment. There is no statutory power
PRACTICE NOTES
This Practice Note explains how a PFI or PF2 project can be terminated. It also looks at the consequences of termination, the risks associated with termination and practical considerations that the parties need to take into account. Note that, in the 2018 Budget (delivered on 29 October 2018), it was announced that the government would no longer use PF2 on new projects (see News Analysis: Budget 2018—what does it mean for infrastructure and housebuilding?). However, existing PFI and PF2 projects will continue to run, and given the typical lifespan of such projects this is likely to be for many years. While both public and private sector parties have historically considered the termination of a PFI project to be a 'nuclear' option, fraught with risk and potential cost exposure, pressure on public sector budgets is significant and termination of expensive PFI projects might be viewed as a serious option by some authorities. Although there are risks attached to a termination, the potential rewards—escaping a politically unpopular, costly contract and taking greater control of service delivery—can be enticing. Particular
PRACTICE NOTES
A construction contract may be discharged, terminated or determined in a number ways. These principally include: • by performance • by agreement/release • as a result of a misrepresentation/fraud (see Practice Note: Misrepresentation—rescission as a remedy) • frustration (see Practice Note: Discharge by frustration) • at common law for 'repudiatory' breach of contract ('repudiation'), or • pursuant to a contractual power to terminate the contract, for example: ◦ for breach of contract ◦ at will ◦ on insolvency This Practice Note looks at termination of a construction contract at common law for repudiatory breach, and termination pursuant to a contractual power either for breach or at will. For guidance on termination on insolvency, see Practice Note: Termination on insolvency in construction contracts. In relation to consultant appointments, see also Practice Note: Termination of a consultant's appointment. Common law termination Where one party has committed a 'repudiatory' breach of contract, the innocent party may elect to either: • 'affirm' the contract and treat the contract as continuing but claim damages resulting from the breach of contract complained of, or
CHECKLISTS
This Checklist provides a summary of the issues that should be taken into consideration before and after a party decides to terminate a building contract, or other agreement entered into in connection with a construction project. Full guidance and information on terminating contracts can be found in the Termination and suspension in construction contracts subtopic. Considerations when deciding whether to terminate A party who is deciding whether to take steps to terminate a construction contract should consider the following points: • What are the reasons for terminating the contract? • Check the provisions of the building contract carefully. Does the building contract contain express provisions regarding termination, setting out specific events that will entitle the parties to terminate? Most UK building contracts contain express termination rights (see Practice Notes: JCT contracts—termination, NEC contracts—termination, FIDIC contracts 2017—termination by the Employer, FIDIC contracts 2017—termination by the Contractor, FIDIC contracts (pre-2017 editions)—termination by the Employer and FIDIC forms of contract (pre-2017 editions)—termination by the Contractor). • If there are contractual grounds for termination, what are they? Does one of these grounds
PRACTICE NOTES
This Practice Note looks at how consultant’s appointments might be terminated, explores the approach taken in standard forms and provides example termination clauses. It should be read alongside Practice Note: Termination of a construction contract, which provides guidance on termination in a construction context more generally. How might an appointment be terminated? Like a building contract, there are a number of ways in which a consultant's engagement on a construction project might be terminated, including: • by performance—ie the contractual obligations being fully performed by the employer and consultant • the parties reaching an agreement to release each other from their obligations • as a result of a misrepresentation/fraud (see Practice Note: Misrepresentation—rescission as a remedy) • frustration (see Practice Note: Discharge by frustration) • at common law for repudiatory breach of contract (see Practice Note: Repudiation of contract) • pursuant to an express contractual provision (which may allow termination upon the occurrence of specified events and/or may allow the employer to terminate at will) Express contractual provisions It is usual for consultant appointments to contain express
PRACTICE NOTES
This Practice Note examines the events and situations that may bring an agency arrangement to an end and the consequences of termination of an agency on the parties involved. This Practice Note does not consider the consequences of termination of a commercial agency, for which see Practice Note: Termination of commercial agency. Termination of agency An agency may be terminated by: • agreement of the parties • other act of the parties • operation of law Termination by agreement or act of the parties An agency may be terminated by the parties on agreement to do so or by either party due to acts by the other amounting to repudiation (see Practice Notes: Termination and expiry of contracts and Repudiation of contract). Written agency agreements should set out any minimum terms and periods of notice applicable, events of breach for which the agreement may be terminated and any specific provisions applicable after notice of termination and termination taking effect. For a precedent that can be adapted as necessary, see Precedents: • Sales and marketing agency agreement for goods—non-exclusive—short
PRACTICE NOTES
This Practice Note covers how the Commercial Agents (Council Directive) Regulations 1993, SI 1993/3053 (the Commercial Agents Regulations) govern the termination of a commercial agency arrangement. It covers a commercial agent’s right to payment of compensation or an indemnity in the event of such termination. It discusses the way that compensation and indemnity may be calculated on termination of a commercial agency arrangement under the Commercial Agents Regulations and the circumstances in which compensation or an indemnity are not payable. The Commercial Agents Regulations came into force on 1 January 1994 and implemented Council Directive 86/653/EEC (OJ L 382/17), the EU Commercial Agents Directive. While the Commercial Agents Regulations derive from EU law, they were retained under the European Union (Withdrawal) Act 2018 (as amended) from 11 pm on 31 December 2020 (IP completion day). They have not been repealed by the Retained EU Law (Revocation and Reform) Act 2023 (REUL(RR)A 2023) and from 1 January 2024 are considered assimilated law in the UK. For more information, see Practice Notes: Introduction to the Retained EU Law (Revocation
NEWS
Planning analysis: In a recent High Court decision, the judge held that Sainsbury’s was entitled to terminate a conditional agreement for the purchase of a stadium from Bristol Rovers. Philip Sissons, barrister at Falcon Chambers, examines the case in more detail and concludes that an obligation of good faith does not override the other terms of the contract.