The Termination Of Contract Due To Non Performance is a crucial legal document used in the Philippine business environment when one party needs to formally end a contractual relationship due to the other party's failure to meet their obligations. This document is particularly important as it must comply with specific requirements under Philippine law, including the Civil Code and relevant Supreme Court jurisprudence on substantial breach. It should be used when there is documented evidence of significant non-performance, after proper notices have been given, and when attempts to remedy the situation have failed. The document typically includes detailed references to the original contract, specific instances of breach, evidence of prior notifications, and the consequences of termination. It's essential for protecting the terminating party's interests while ensuring procedural fairness and legal compliance.
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1. Parties: Identification of the contracting parties, including their complete legal names, addresses, and legal capacity
2. Background: Reference to the original contract, its date, purpose, and key obligations of both parties
3. Definitions: Definition of key terms used in the termination notice, including references to defined terms in the original contract
4. Details of Non-Performance: Specific description of the breaches or failures to perform, including dates, instances, and impact
5. Prior Notices and Opportunities to Cure: Documentation of previous notifications of breach and opportunities provided to remedy the non-performance
6. Legal Basis for Termination: Citation of relevant contract clauses and legal provisions supporting the termination
7. Effective Date of Termination: Clear statement of when the termination takes effect
8. Consequences of Termination: Details of what happens upon termination, including immediate obligations of both parties
9. Outstanding Obligations: List of any payments, returns of property, or other obligations that must be fulfilled
10. Reservation of Rights: Statement preserving the terminating party's rights to seek damages or other remedies
1. Transition Arrangements: Include when there's a need for an orderly transfer of responsibilities or materials
2. Confidentiality Obligations: Include when there are ongoing confidentiality obligations that survive termination
3. Dispute Resolution: Include when parties wish to specify a particular method for resolving disputes arising from the termination
4. Return of Property: Include when there is physical or intellectual property that needs to be returned
5. Non-Competition/Non-Solicitation: Include when there are post-termination restrictions that need to be emphasized
6. Mutual Release: Include when parties agree to release each other from future claims
1. Schedule A - Original Contract: Copy of the original contract being terminated
2. Schedule B - Breach Notice Records: Copies of all notices of breach and related correspondence
3. Schedule C - Performance Failure Evidence: Documentation evidencing the non-performance or breaches
4. Schedule D - Outstanding Payments: Detailed list of any outstanding payments or financial obligations
5. Schedule E - Transition Plan: If applicable, detailed plan for transitioning responsibilities or services
6. Appendix 1 - Property Inventory: List of properties or materials to be returned or transferred between parties
Relevant legal definitions
Clauses
Relevant Industries
Construction
Information Technology
Manufacturing
Professional Services
Real Estate
Retail
Wholesale Trade
Transportation and Logistics
Healthcare
Education
Financial Services
Telecommunications
Relevant Teams
Legal
Procurement
Operations
Risk and Compliance
Corporate Secretariat
Business Development
Contract Administration
Project Management Office
Executive Management
Relevant Roles
Chief Executive Officer
Managing Director
Chief Legal Officer
Legal Counsel
Contract Manager
Procurement Manager
Project Manager
Business Development Manager
Operations Director
Risk Manager
Compliance Officer
Corporate Secretary
General Manager
Department Head
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