Operation and effect The mutual rights of the parties are governed by the terms of their withdrawal agreement. The parties are usually restored to their original rights with respect to the subject matter. You no longer have any rights or obligations under the contract due for cancellation, and no claim or action for subsequent breach can be maintained. The use of the word “termination” leads to the question of what to terminate. The PECL speaks of “contract termination”. However, for the purposes of these provisions, the term “termination of the contract” is not strictly applicable. As soon as a contract has taken place as a legal act, it is concluded and cannot be terminated. It would be more accurate to say that the contractual relationship between the parties will be terminated. However, the relationship is not necessarily completely over.
There may be cases where, for example, only a separable part of the obligations and rights of the parties to the contract is terminated. In such cases, some aspects of the relationship may survive. For this reason, the relevant articles refer to the total or partial termination of the contractual relationship. There could be a risk that by unreasonably insisting on a particular performance by the debtor, if the creditor could easily obtain enforcement elsewhere, a creditor could inflate the damages for the debtor`s non-performance or the amount of an agreed payment for non-performance calculated after the day or week. The control of such abuses is the general provision that remedies must be exercised in accordance with the principles of good faith and fair trade. Another more specific control is provided for in Article 3:302(5) of the dIR, which prevents the creditor from recovering damages or a specified amount for non-performance to the extent that the creditor has increased the loss or the amount of the payment by unduly insisting on particular performance in cases where the creditor could reasonably be expected to receive benefits from another source. It is also a new rule that is not included in the PECL. Whether the creditor should have the right to terminate the contractual relationship in whole or in part in the event of non-performance of a contractual obligation depends on a balance between conflicting considerations. On the one hand, the creditor may wish for an extended right of termination […].Leave a reply