Writing a Contract Termination Letter (with Samples)
Use these sample contract termination letters as templates for your formal notification.
Contracts are a good thing, but they are made to be broken. Most contracts have some sort of loop hole that allows a person to get out of them without being scathed. However, there are some contracts that will charge a fee or there will be some sort of repercussion from this action.
Regardless of the reason that someone wants out of a contract, it is proper to write a letter to back up the decision legally. Because there are so many things that can and will go wrong when breaking a contract, always make sure to have some sort of proof in writing.
A contract termination letter is often written to break or terminate a legally binding agreement. This can be for a rental agreement, a business arrangement or even employment. When one or the other party needs to end their current agreement, it is best to put it in both written and verbal forms.
Regardless of the reason that someone wants out of a contract, it is proper to write a letter to back up the decision legally. Because there are so many things that can and will go wrong when breaking a contract, always make sure to have some sort of proof in writing.
A contract termination letter is often written to break or terminate a legally binding agreement. This can be for a rental agreement, a business arrangement or even employment. When one or the other party needs to end their current agreement, it is best to put it in both written and verbal forms.
Even if both parties agree and the decision is mutual, it is still always best to put it in writing. To start this type of letter, a person must first know the legalities of what they are doing. Is there any recourse the other party can take based on this decision?
Is there going to be a charge, like there would be with breaking a lease? The letter needs to be short and sweet and should never drag on for pages with hundreds of reasons. State a basic reason why a termination of this contract is in the best interest and leave it at that.
This letter is formal in nature, so it must be written properly. This means starting with the date and the parties name and address. This step is critical because the letter needs to be addressed properly so it reaches the right person. The greeting should be a standard “Dear,” as you don’t want to be too friendly in this type of letter.
No Guidelines
There are no guidelines or rules for how long the body of the letter must be. Standard letters have at least two paragraphs. The letter must open with a formal statement that includes verbiage like, “on the 21st day of December, YEAR the contract between Global World Solutions and Jeffrey Henderson will be officially terminated.” This makes the letter official and sounds like it someone who has done plenty of research into the matter.
A letter breaking a contract is really not the place to get into bashing the other person. Remember this letter can be used against a person in court. Don’t put anything in this letter that could be damaging at a later date. Don’t get into deliberations on who is right and who is wrong.
Simply state the facts and be done. Don’t overdue the letter and don’t leave any questions. The reader should know exactly what the other party wants to do and here should be no beating around the bush. Here are sample contract termination letters.
Is there going to be a charge, like there would be with breaking a lease? The letter needs to be short and sweet and should never drag on for pages with hundreds of reasons. State a basic reason why a termination of this contract is in the best interest and leave it at that.
This letter is formal in nature, so it must be written properly. This means starting with the date and the parties name and address. This step is critical because the letter needs to be addressed properly so it reaches the right person. The greeting should be a standard “Dear,” as you don’t want to be too friendly in this type of letter.
No Guidelines
There are no guidelines or rules for how long the body of the letter must be. Standard letters have at least two paragraphs. The letter must open with a formal statement that includes verbiage like, “on the 21st day of December, YEAR the contract between Global World Solutions and Jeffrey Henderson will be officially terminated.” This makes the letter official and sounds like it someone who has done plenty of research into the matter.
A letter breaking a contract is really not the place to get into bashing the other person. Remember this letter can be used against a person in court. Don’t put anything in this letter that could be damaging at a later date. Don’t get into deliberations on who is right and who is wrong.
Simply state the facts and be done. Don’t overdue the letter and don’t leave any questions. The reader should know exactly what the other party wants to do and here should be no beating around the bush. Here are sample contract termination letters.
Sample 1 - Contract Termination Letter
DATE
Globadine Rental Properties
8924 Central Center Parkway
Chillicothe, Ohio 45601
Attn: Larry Shaffer
Dear Mr. Shaffer,
We are under a lease agreement that expires on DATE. Due to circumstances beyond our control, we must end this lease agreement and turn in the keys to our unit. The recent recession has caused my job to transfer me to another state to keep employment.
Since it would be hard to make the kind of money I make starting out at another company, I am left with no choice but to take the offer. On DATE, Robert and Jessica Snyder formally terminate their lease agreement with Globadine Rental Properties. While this letter is reaching you a few days early, we felt a grace period was only courteous.
According to our current lease agreement, should we terminate, the rental rate would be deducted from the deposit and further charged until the unit was rented. We understand that you currently hold a deposit in the amount of $1,500 that we placed on this unit. While your lease is clearly written, it does not follow the State of Ohio laws for termination of a rental agreement.
According to section 5321.05 - 5321.16 of the Ohio’s revised code, when a tenant terminates their rental agreement, they can only be charged with a maximum of one month’s vacancy loss. While this money can be removed from the deposit, we cannot be charged for more than one month. The apartment is in good repair, and there should be no further fees deducted from the deposit.
Please send the remainder of our deposit to our new address at, 708 E. Broad Street, Piccadilly, KS 48902. I know that this is short notice, but we didn’t have much notice ourselves regarding this job transfer. If you have any questions, please feel free to call us at 740-779-0394.
Sincerely,
Jessica Snyder
Sample 2 - Contract Termination Letter
Date
Recipient Name
Company Name
Recipient Address
Re: Construction Contract Termination
Dear Mr. Recipient:
This correspondence is sent in accordance with sections 6 and 7 of the contract between SENDER and RECIPIENT. Over the last two months, it has become clear that the construction project at (SENDER'S ADDRESS) is not going to be finished with the efficiency and quality that were promised in the original contract. Accordingly, RECIPIENT is hereby notified of the termination of this contract.
Specifically, SENDER became aware on DATE of certain defects in the quality of the cabinetry and counter tops that were installed at the above-mentioned address. RECIPIENT was informed of the problems the same day. In accordance with the terms of the contract, RECIPIENT promised to fix the issues within 30 calendar days.
It is now 15 days after the expiration of that 30 calendar day period, and no further work has been completed. Sections 6 and 7 of the contract stipulate that SENDER may terminate the contract if issues brought to the attention of RECIPIENT are not resolved within 30 calendar days. Accordingly, this contract is terminated, and SENDER is not responsible for any balance due to RECIPIENT.
Please sign a copy of this letter and return it to us within seven days of receipt.
Very truly yours,
Sender's signature
Date
Recipient Name
Company Name
Recipient Address
Re: Construction Contract Termination
Dear Mr. Recipient:
This correspondence is sent in accordance with sections 6 and 7 of the contract between SENDER and RECIPIENT. Over the last two months, it has become clear that the construction project at (SENDER'S ADDRESS) is not going to be finished with the efficiency and quality that were promised in the original contract. Accordingly, RECIPIENT is hereby notified of the termination of this contract.
Specifically, SENDER became aware on DATE of certain defects in the quality of the cabinetry and counter tops that were installed at the above-mentioned address. RECIPIENT was informed of the problems the same day. In accordance with the terms of the contract, RECIPIENT promised to fix the issues within 30 calendar days.
It is now 15 days after the expiration of that 30 calendar day period, and no further work has been completed. Sections 6 and 7 of the contract stipulate that SENDER may terminate the contract if issues brought to the attention of RECIPIENT are not resolved within 30 calendar days. Accordingly, this contract is terminated, and SENDER is not responsible for any balance due to RECIPIENT.
Please sign a copy of this letter and return it to us within seven days of receipt.
Very truly yours,
Sender's signature
Sample 3 - Contract Termination Letter
LETTERHEAD
DATE
Name of Client
Name of Business of Client
Address of Client
City, State, Zip Code
RE: Termination of contract for SPECIFIC SERVICES
Dear Name of Client:
This letter is formal notification that NAME OF PROPERTY MANAGEMENT COMPANY will no longer be maintaining the property at ADDRESS. We have regularly maintained the property including the landscaping and repairs and maintenance for that past 18 months, however after the first year, we have not received payment for services. I have enclosed copies of the unpaid invoices of the last two quarters. We sent two reminders, of which I have enclosed copies, and received no response.
As of DATE, we are no longer contracted to continue the property management of ADDRESS. We have followed the terms and conditions set down in the contract for cancellation of said contract. The company will be pursuing the unpaid bills through legal means. If you have any questions, I can be reached at Phone Number or Email Address.
Sincerely,
Signature of Company Representative
Printed Name of Company Representative
List of Enclosures: Copies of Invoices and Request for Payment Letters
By Andre Bradley
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