The Cancellation of Rental Agreement is a crucial legal document used in the Philippines when both parties mutually agree to end a lease arrangement before its original termination date or to formally document the end of a lease. This document is essential for protecting both landlords' and tenants' interests, ensuring clear documentation of the termination terms, and preventing future disputes. It must comply with Philippine Civil Code requirements and local rental regulations, including the Rent Control Act for residential properties. The agreement typically includes provisions for property inspection, security deposit return, utility settlements, and final payments. It's particularly important in both residential and commercial contexts, where formal documentation of lease termination is necessary for legal and accounting purposes.
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1. Parties: Identification of the Landlord and Tenant, including their complete legal names, addresses, and contact information
2. Background: Reference to the original lease agreement, including its date, property details, and current rental terms
3. Definitions: Key terms used in the cancellation agreement, ensuring clarity and preventing misinterpretation
4. Termination Date: Specific date when the lease will be terminated and the tenant will vacate the property
5. Mutual Agreement to Cancel: Clear statement that both parties agree to terminate the lease agreement
6. Return of Security Deposit: Terms and timeline for the return of the security deposit, subject to property inspection
7. Final Payments: Details of any final rent payments, utilities, or other charges due
8. Release of Obligations: Mutual release of future obligations under the original lease agreement
9. Property Inspection: Requirements for final inspection and condition assessment of the property
10. Governing Law: Confirmation that the agreement is governed by Philippine law
11. Execution: Signature blocks for all parties and witnesses
1. Outstanding Repairs: Used when there are pending repairs or maintenance issues that need to be addressed before termination
2. Forwarding Address: Include when the tenant needs to provide a forwarding address for future correspondence or deposit return
3. Keys and Access Devices: Used when there are specific requirements for returning keys, access cards, or other property access devices
4. Early Termination Fee: Include if there is an agreed-upon fee for early termination of the lease
5. Utilities Transfer: Used when there are specific requirements for transferring or disconnecting utilities
6. Property Modifications: Include when addressing any modifications made to the property that need to be restored or addressed
7. Surviving Obligations: Used when certain obligations survive the termination of the lease
1. Schedule A - Original Lease Agreement: Copy of the original lease agreement being cancelled
2. Schedule B - Property Inspection Report: Detailed report of the property's condition at the time of cancellation
3. Schedule C - Payment Settlement Statement: Detailed breakdown of final payments, including any adjustments to the security deposit
4. Schedule D - Photographic Evidence: Photos documenting the property's condition at the time of cancellation
5. Schedule E - Utility Readings: Final utility meter readings and outstanding bills
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