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Express termination clauses in contracts
Abstract
Having set express termination clauses (ETCs) in their legal context, this article's first aim is briefly to explain three significant points concerning their operation which have now been clarified. Other important questions remain unresolved, and the second aim is to explore four of them: the judicial “reading down” of ETCs; whether termination need be immediate; the recoverability of expectation damages; and the avoidance of an unintended repudiation. Respects in which the English law of contract on each of them would benefit from development or change are identified, and it is argued that the Canadian approach to the award of expectation damages following termination pursuant to an ETC is preferable to the established Anglo-Australian position.
... 85 Under English common law, property rights are categorized as either legal or equitable, 86 and the latter is considered subservient in the event of conflict. 87 In retention of title (ROT) transactions, 88 such as conditional sale, 89 equipment leasing, 90 or hire purchase, 91 the legal title resides with the seller or owner of assets; while the equitable right resides with the buyer in possession of those assets who makes use of them "in the ordinary course of business. " 92 ROT transactions in England are not required to be registered in the collateral registry for a third party effectiveness, 93 even though this generates the problem of ostensible ownership, due to the lack of an objective manner for the public to ascertain that such a ROT asset (being used in the ordinary course of business) does not fully belong to the user. ...
The uncritical transplantation of English law by Anglophone-African legislators and judges, and their failure to sufficiently adapt English legal concepts to suit the idiosyncratic socioeconomic conditions in Africa, arguably contribute to the per-petuation of English law's hegemony therein. It is argued that the overdependence on English law and courts by African businesses in resolving contractual disputes is not necessarily due to any alleged stellar qualities of the former, but largely due to the over-marketing of the English legal system's competence by its apologists. The analysis uses piquant examples to elicit some adverse effects of using/overreliance on the English law and forum by African businesses in resolving contractual disputes. To reposition from the lengthened shadow of English law, Anglophone African leg- islators, judges and legal scholars, must craft autochthonous legal processes that suit Africa’s tastes and socioeconomic milieu.
... Commercial contracts can contain express termination clauses which provide for contractual termination when certain specied circumstances occur. These contractual termination clauses indicate expressly terms as conditions or warranties as circumstances in which the contract can be brought giving a right to claim damages (Randall 2014). Under Italian law, the express termination clause provided for in article 1456 of the Italian Civil Code allows for the immediate termination of a contract if a specied obligation is not fullled as agreed. ...
In this paper, we model private art market agents’ strategic interactions in presence of two types of asymmetric information, about artwork quality and buyer’s knowledge, assuming the seller does not know how informed is the buyer while the buyer does not know the quality of the artwork before purchase. If the seller can choose either a high or a low price and the buyer can signal his type to the seller, we identify the conditions for both equilibria with pooling buyer signalling strategy and with separating strategy, as well as conditions for equilibria where the seller fixes the price according to the actual quality and where he posts prices trying to take advantage of buyer’s limited information. Finally, we identify the condition for the emergence of a “counter-lemon” result, where low-quality artworks and uninformed collectors exit the market, suggesting that seller uncertainty does not directly benefit the buyers, but it can impact the quality traded in the market.
An express termination clause (an ‘ETC’) is an express term of a contract which gives either or both of the parties the right to terminate the contract. ETCs are found in many longterm commercial contracts. It is the aim of this chapter to increase the level of confidence that commercial parties may have when relying on an ETC by resolving a number of legal uncertainties associated with their use. Commercial parties will be reluctant to rely on an ETC if uncertainty surrounds its application. This may be because the events which ‘trigger’ the clause are not precisely defined, or because the procedure to be followed when relying on the clause leaves room for doubt, as where the clause requires one party to give the other the opportunity to remedy a breach before termination and there is uncertainty as to whether the breach can be, or has been, remedied. There is also potential uncertainty as to whether one party’s reliance on an ETC prevents that party from relying on any right to terminate that it may have under the common law. Concern that mistaken reliance on an ETC may lead to potential liability in damages to the other party is often matched by concern that mistaken reliance on an ETC will cause reputational damage within the market in which the parties operate. The application of an ETC by one party can lead to what may appear to be a ‘harsh’ outcome for the other. For example, depending on the wording of the clause, a relatively minor breach by one party might give the other a right of termination that it would not otherwise have under the common law. Some ETCs even allow one party to terminate the contract at its own convenience without having to establish breach by the other party or any other cause. Should the courts be able to interfere, and risk increased uncertainty of outcome, through the implication of a good faith requirement in such cases?.
The Unaccepted Repudiation and Legal Rights
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Damages for breach of contract terminated under express terms
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Delay, Damages and the Doctrine of Constructive Repudiation
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