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Mutual Release Agreement for Germany

Mutual Release Agreement Template for Germany

A German law-governed Mutual Release Agreement (Erlassvertrag) is a bilateral legal document where two or more parties agree to release each other from specified claims, obligations, or liabilities. The agreement operates under the provisions of the German Civil Code (BGB), particularly sections dealing with settlement agreements (Vergleich) and release of obligations. It includes detailed provisions regarding the scope of releases, representations about claim ownership, and future conduct obligations. The document must comply with German formal requirements and contract interpretation principles, making it a robust tool for definitively resolving disputes or potential claims between parties.

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What is a Mutual Release Agreement?

The Mutual Release Agreement is a critical legal instrument used in German business and civil law contexts when parties wish to resolve existing disputes or prevent potential future claims. This document is particularly valuable following the termination of business relationships, resolution of disputes, or completion of complex transactions. The agreement must comply with German Civil Code (BGB) requirements, particularly regarding settlement agreements (Vergleich) and release of obligations. It typically includes comprehensive releases, warranties about claim ownership, and provisions regarding future conduct. The document is commonly used in corporate restructuring, employment separations, partnership dissolutions, and post-transaction claim settlements. The Mutual Release Agreement's effectiveness under German law depends on clear specification of released claims and proper execution by authorized representatives.

What sections should be included in a Mutual Release Agreement?

1. Parties: Identification of all parties to the agreement, including their legal names, addresses, and registration details if applicable

2. Background: Context of the dispute or circumstances leading to the mutual release, including reference to any existing agreements or claims

3. Definitions: Key terms used throughout the agreement, including 'Claims', 'Effective Date', and any specific terms relevant to the releases

4. Mutual Release: Core provisions detailing the mutual releases, including scope of claims being released and effective date of releases

5. Representations and Warranties: Statements by each party regarding their authority to enter into the agreement and ownership of claims being released

6. No Admission of Liability: Statement that the agreement and releases do not constitute admission of liability by any party

7. Consideration: Description of the consideration being exchanged for the mutual releases

8. Future Conduct: Obligations regarding future actions, including non-pursuit of released claims

9. Governing Law and Jurisdiction: Specification of German law as governing law and designation of competent courts

10. Entire Agreement: Integration clause confirming this document represents the entire agreement regarding the releases

11. Execution: Signature blocks and execution requirements

What sections are optional to include in a Mutual Release Agreement?

1. Confidentiality: Provisions regarding confidentiality of the agreement and its terms, used when parties wish to keep the settlement private

2. Tax Matters: Provisions addressing tax implications of any payments or releases, included when there are significant tax considerations

3. Related Entities: Extension of releases to affiliated entities, subsidiaries, or related persons, used when releases should cover broader corporate groups

4. Surviving Obligations: Identification of any obligations that survive the releases, included when certain obligations should continue

5. Non-Disparagement: Mutual obligations not to make negative statements about other parties, included in sensitive or public-facing disputes

6. Return of Property: Provisions regarding return or destruction of documents or property, used when relevant to the dispute

7. Costs: Allocation of costs and expenses related to the agreement and dispute, included when cost allocation is relevant

8. Severability: Provisions addressing the survival of remaining terms if any provision is found invalid, included for additional legal certainty

What schedules should be included in a Mutual Release Agreement?

1. Schedule of Released Claims: Detailed list of specific claims being released by each party

2. Schedule of Excluded Claims: List of any claims specifically excluded from the releases

3. Schedule of Related Proceedings: List of any legal proceedings to be discontinued as part of the release

4. Schedule of Payments: Details of any payments to be made as part of the settlement, if applicable

5. Power of Attorney: If signatories are acting under power of attorney, copies of relevant authorizations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Germany

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions






















Clauses























Relevant Industries

Manufacturing

Technology

Financial Services

Professional Services

Healthcare

Real Estate

Construction

Retail

Energy

Telecommunications

Transportation

Education

Insurance

Media and Entertainment

Pharmaceuticals

Relevant Teams

Legal

Human Resources

Executive Leadership

Finance

Compliance

Risk Management

Operations

Corporate Governance

Business Development

Project Management

Relevant Roles

Chief Executive Officer

Managing Director

General Counsel

Legal Director

Chief Financial Officer

Human Resources Director

Compliance Officer

Risk Manager

Business Development Director

Operations Manager

Contract Manager

Corporate Secretary

Partnership Manager

Project Manager

Department Head

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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