There are several options for terminating a business contract

On Behalf of | Aug 19, 2020 | Business Litigation |

Business owners depend on contracts to keep their companies not only up and running, but running as efficiently as possible. At some point, business contracts no longer serve their purpose and need to be terminated. While the hope is that terminating these legally binding agreements will be because they have run their course and were completed successfully, the simple truth is there are many reasons why they might need to be voided, and there are several ways to go about doing it.

Reason number one: contract breach. The simple reality of contracts is, not everyone ends up honoring them. Those who find themselves stuck in a contract with someone who is not upholding their end of the deal have every right to break the agreement.

Reason number two: rescission. A contract may be rescinded for a number of reasons. Some of them include fraud, mistakes made, or misrepresentation of self — among other things.

Reason number three: prior agreement to terminate. Terms to terminate a contract may be included in the document. This is known as a break clause. If one of the qualifying reasons to break an agreement exists, either party may request to terminate the contract.

Reason number four: inability to perform. Contracts are created with the expectation that one or both parties will perform a specific service. If either party is incapable of performing the agreed-upon duties due to something out of their control, the contract may be voided due to the inability or impossibility to perform.

Terminating a contract can be done according to the terms in a break clause, by filing an official notice, through the negotiations process, or, if necessary, litigation. In other words, there is no one-size-fits-all approach to going about it. With the assistance of legal counsel, business owners in Louisiana who need to have contracts voided can do so as quickly and pain-free as possible, while at the same time taking steps to minimize any damage the contract termination might have on their companies.