Clarion Solicitors Limited
3 Experts
2 Contributions by Clarion Solicitors Limited Experts
PRACTICE NOTES
Term and termination
This Practice Note outlines a range of approaches to drafting term and termination clauses in commercial contracts for business-to-business (B2B) dealings. It explores how express contractual provisions align with common law rights concerning the length and ending of contracts, offers practical guidance on preparing term and termination clauses, and highlights the principal issues to address in negotiations. Where an agreement is silent on duration or ending, if a dispute arises, the courts will apply common law principles to discern the parties’ intentions. To reduce uncertainty, it is typical to include express clauses that set out the duration and termination of a contract. As a rule, contractual rights to terminate are additional to, and not a replacement for, common law rights. This Practice Note concentrates on contractual terms dealing with duration and termination in a general commercial context, why they warrant careful
Commercial
CHECKLISTS
This Checklist outlines the principal points to weigh up when drafting term and termination provisions in a commercial contract for use by the parties. For additional guidance on the duration and ending of commercial contracts generally, in practice, see:
Practice Note: Drafting term and termination clauses—commercial contracts and
Contract termination—overview
General drafting points
The common law has developed a series of principles concerning contract length and termination. For instance, where a contract says nothing about duration, a court may imply a right to end it on reasonable notice. In some situations, parties may also end a contract for repudiatory breach. Nevertheless, it is usually better to set out express terms on duration and termination to give the parties certainty, rather than depending on common law. If a contract lacks express termination rights, it may be uncertain whether a given breach allows the
Commercial
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