Grounds and procedure for termination of the contract. When terminating a contract unilaterally, you should know some points

In practice, unilateral termination of a contract always gives rise to a dispute between the parties, especially if one of the parties objects to such an expression of will. When we conclude an agreement, it feels like it will last for a long time. But life does not stand still. Circumstances change; it is urgent to end outdated relationships.

Art. 450 of the Civil Code distinguishes between the concepts of termination of a contract at the request of one of the parties and unilateral refusal to perform the contract.

The difference between these two methods is the procedure for termination. First way- (termination at the request of one of the parties) - in court (under paragraph 2 of Article 450 of the Civil Code of the Russian Federation), second(unilateral refusal to fulfill the contract) - out of court (under paragraph 3 of Article 450 of the Civil Code of the Russian Federation).

Often in practice, one party sends the other a notice of early termination of the contract, believing that this has terminated the contract, but a few months later the other party files a lawsuit to recover, for example, fees under the lease agreement, because the termination procedure was not completed and wins the case.

At its core, the demand of one of the parties to terminate the contract in the absence of the consent of the other party is not a transaction and does not entail the termination of rights and obligations. The latter are terminated only by the court and in the presence of certain grounds for this.

There must be conditions that make this procedure legal, for example, a significant violation of the contract by the other party. Otherwise, the initiating party will not be able to exercise this right and terminate the contract even in court. Moreover, if as a result of its actions damage is caused to the second party or third parties, the initiator of termination of the contract may be subject to recovery of damages caused.

The second method is out-of-court. Refusal to fulfill a contract involves termination of the contract unilaterally out of court. Unilateral refusal to fulfill the contract must be provided for by the contract or legislation. Important, that for a unilateral refusal it is not necessary to violate any terms of the contract.

Thus, if the parties to the contract wish to provide for the possibility of unilateral termination of the contract without a trial, by simple notification, then in the contract it is better to use the wording “not unilateral termination of the contract,” but “unilateral refusal to perform the contract.”

For example: " Any Party has the right to refuse to perform the Agreement unilaterally by sending a written notice to the other Party no later than 30 (thirty) working days" OR "Any Party has the right to refuse to perform the Agreement unilaterally by sending a written notice to the other Party. The Agreement terminates on the date specified in the notification, but not earlier than 10 (ten) business days after receipt of the notification by the other Party."

Termination of an agreement under the Civil Code of the Russian Federation is a topic that includes a variety of situations, since in the course of the activities of enterprises the need for this may arise a large number of times. We will talk about what reasons exist and when termination of contractual relations is possible in this article.

Grounds and procedure for termination of the contract. Termination of a public contract

Civil Code of the Russian Federation, namely Ch. 29, informs about the general reasons for termination of the contract. This means that in the absence of special rules for named contracts, this chapter must be followed.

Summarizing the rules of the code, we can come to the conclusion about the possibility of the following methods of terminating a contract before achieving its goal or expiration of the term:

• reaching agreement on the completion of the contract;
• filing a claim for its termination in court;
• unilateral refusal (notification procedure, where the statement of 1 partner is sufficient).

The legislator did not provide any specifics regarding public contracts. At the same time, the Constitutional Court of the Russian Federation, in its ruling dated June 6, 2002 No. 115-O, formulated a position on the impossibility of a commercial organization, for which the conclusion of a public contract is mandatory, to terminate the contract on its own initiative while it is still possible to provide a service.

Termination of the contract unilaterally

Unilateral termination of a contract represents a deviation from the general principle that the agreement can be terminated only if there is the will of all those who entered into it. Accordingly, it is possible to terminate a contract without the consent of the partner only in special cases that deprive the initiator of termination of the prospects that he counted on when accepting obligations.

These cases may arise due to 2 types of conditions ( reasons for termination of the contract):

• significant deviation by the counterparty from the agreed terms (clause 2 of Article 450 of the Civil Code of the Russian Federation);
• a change in circumstances that seriously disrupted the counterparty’s plans in relation to this agreement (Article 451 of the Civil Code of the Russian Federation).

In this regard, when demanding termination of the contract in court, you will have to collect evidence of both the existence of a violation/change in circumstances and the damage caused by this legal fact, as well as the cause-and-effect relationship between these circumstances (Part 1 of Article 65 of the Arbitration Procedure Code of the Russian Federation).

Refusal to execute a contract: rules

Art. 310 of the Civil Code of the Russian Federation determines the impossibility of refusing to fulfill one’s contractual obligations solely at will, without the consent of the counterparty, while establishing exceptions in the form of cases prescribed in other laws, as well as the Civil Code of the Russian Federation.

Any party to whom such a right is granted by its terms or by force of law can refuse to perform a contract. To do this you need:

1. Provide the counterparty with a notice of refusal to fulfill its obligations. As soon as the other party receives the specified notice, the contract will be considered terminated and its validity will be terminated, unless other conditions were specified in the law or the agreement itself (clause 1 of Article 450.1 of the Civil Code of the Russian Federation).
2. Confirm the action by sending to the counterparty a refusal to exercise its right. In this case, the reason that served as the reason for refusing to fulfill it cannot be subsequently used again as a reason. An exception will be the occurrence of the same events again (clause 6 of Article 450.1 of the Civil Code of the Russian Federation).

Termination of contractual relations by agreement of the parties

Art. 450 of the Civil Code of the Russian Federation regulates that the cancellation of a contract can occur by mutual agreement of the parties, unless other provisions apply to it, and prohibitions are not established by law.

Termination of the contract in this case implies early termination of its validity, in other words, such a situation may arise when the parties have mutually lost interest in its execution.

The procedure for judicial termination of a contract

As mentioned above, termination of contractual relations only by court decision is possible in the following cases (clause 2 of article 450, article 451 of the Civil Code of the Russian Federation):

1. In case of non-compliance with the terms of the contract, which will subsequently be recognized as significant.
2. In the event of a significant change in circumstances, as a result of which one of the parties will lose interest in the transaction as a whole.

At the same time, the court will assess the significance of each violation at its own discretion based on the specific situation, as, for example, stated in the information letter of the Presidium of the Supreme Arbitration Court of the Russian Federation dated January 11, 2002 No. 66.

Termination of the contract through judicial proceedings is carried out subject to compliance with the claims procedure (clause 2 of Article 452 of the Civil Code of the Russian Federation). This requires:

• sending a letter to the counterparty with a proposal to make adjustments or terminate cooperation;
• receiving a refusal/silence on an offer letter.

The parties are given the right to agree on a period for receiving such a response. If it is not agreed upon, it is generally assumed to be 30 days.

It is impossible to list all the grounds on which a contract can be terminated in court, since, based on the conditions of freedom of contract (Article 1 of the Civil Code of the Russian Federation), the parties have the right to independently determine and indicate the reasons that may serve as the basis for going to court for the purpose of its termination.

Termination of the contract of the Civil Code of the Russian Federation allows both by mutual agreement of the parties and unilaterally (judicially). In addition, the Civil Code of the Russian Federation contains provisions regulating the procedure for unilateral refusal to execute it in exceptional cases.

The denunciation of a treaty must take into account the rules and regulations of civil law. As a rule, if it happens according to the desire of one side, the other opposes it. As a consequence, the question arises of how to terminate the contract, providing for all possible options for a painless exit from this relationship.

Termination of the contract by the will of both parties

If both parties decide to terminate the contractual relationship, the termination procedure takes place by agreement between them. The form of the document depends on the form of the original agreement, that is, if it is signed and agreed upon by the parties, then the denunciation agreement must be drawn up in a similar way. The heads of organizations or their authorized representatives have the right to sign such papers.

Before terminating a contract, the denunciation document must provide the basis for termination (if its procedure is voluntary, then the basis will be the will of the parties), as well as the moment of termination of the fulfillment of contractual obligations. If there are unfulfilled or unfinished obligations, it is necessary to provide for deadlines for their closure.

Unilateral denunciation

The grounds applicable to this may be provided both in the Civil Code of the Russian Federation and in the document itself. First of all, these are late fulfillment of obligations, non-payment under the contract, deprivation of the contractor’s permits for the affected types of activities and licenses, as well as repeated violation by a party (or both) of the terms of the contract. The most important thing is that there must be good reasons for canceling the agreement. Since such termination is not a transaction, it is carried out by going to court if it was not possible to resolve the problem pre-trial.

Termination of the loan agreement

An ordinary borrower, as a rule, is not very well versed in the legal peculiarities of the relationship between the creditor and the debtor. That is why most citizens, when drawing up an agreement, agree to the illegal conditions of banks. In this case, the question arises of how to terminate the loan agreement.

There must be a reason for this. For example, if a bank does not have the appropriate permission from the Central Bank to carry out certain or all types of activities, then such a document is considered illegal and has no legal force.

An agreement that does not fully reflect information about the proposed loan product may also be terminated if the agreement does not clearly define such constituent elements of the loan as interest, commissions, terms, etc.

An agreement in which the terms have been changed unilaterally without the consent of the debtor also loses its validity.

In addition, it may be due to the lack of a bank seal or the borrower’s personal signature. No less important here is the cancellation of the security agreement. To cancel the agreement, you must apply to the court.

How to terminate a loan agreement? It is worth keeping in mind that absolutely any such agreement must be concluded only in writing, since otherwise it is difficult to prove the bank’s illegal actions.

Cancellation of a rental agreement

Before terminating the lease agreement, you must familiarize yourself with this procedure before signing all the papers. This will help to avoid various surprises later.

Just like any other civil agreement, the lease agreement is denounced by agreement of the parties. The conditions can be any.

The grounds for termination at the request of the parties are enshrined in the Civil Code of the Russian Federation. The lessor may cancel the agreement ahead of schedule if the tenant uses the property with repeated violations, thereby significantly worsening its condition, or does not comply with the terms of the agreement. When the other party fails to pay more than twice in a row within the payment period established by the contract, the lessor can easily solve the problem of how to terminate the contract early. He can also do this due to failure to carry out major repairs of the property within the time limits established by the contract.

The tenant also has the right to terminate the contract early. The reason may be the behavior of the lessor, who interferes with or does not provide the property for use in accordance with the agreement. In addition, the reason for denunciation is often the shortcomings of the property not specified by the lessor, which prevent its full use.

How else can I terminate the contract? For the tenant, the reason for canceling the agreements may be the lack of major repairs, which is the responsibility of the property owner.

Termination of the purchase and sale agreement

How to terminate a purchase and sale agreement? When solving this problem, it is necessary to remember that in the event of denunciation, the parties do not have the right to demand the return of what was fulfilled under the obligation before the termination of the agreement, unless otherwise provided by the contract or legislation.

Cancellation of an insurance contract

The simplest way to solve this problem is to terminate the contract by agreement of both parties. But how to terminate an insurance contract and at the same time refuse further cooperation? There are two options here: the insurance company itself refuses due to the other party’s failure to fulfill the clauses of the contract, or this is done by the client using the insurance services, who can denounce the contract only if the insurance was not mandatory, but voluntary. It must be remembered that the amount of contributions paid before the termination of the agreement will not be returned to the citizen. But you can still write a request for a refund if you decide to terminate the contract before paying all insurance premiums.

Termination of agreement with the bank

Applying for a loan is not a problem now, but how to terminate the agreement with the bank? Despite the labor intensity and rather large time costs, this can be done in two ways.

The best option is denunciation by agreement of the parties. There are usually no special restrictions here, but such termination may entail some consequences (compensation or damages). In this case, the parties sign a written agreement with the specified amount and payment terms.

In order to terminate the agreement unilaterally, it is necessary to go to a civil court, since this is the only way to terminate the agreement with the bank. But this happens only in special cases (for example, the bank violates its obligations).

The agreement can also be canceled at the initiative of the bank. This situation arises when the client hides information about the quality, loss or reduction of the collateral, violates the procedure for repaying the debt, or has already spent funds for other purposes. Denunciation may also occur if the client’s financial situation has become worse. When collaborating with a legal entity, the reason for termination is reorganization, bankruptcy, or liquidation of the enterprise.

How to terminate an employment contract

The basis may be the usual agreement of the parties (the other party must report its decision in writing within 3 days). Also, the reason for terminating the contract is the expiration of its validity period. Termination of the agreement can occur at the initiative of the employer (he is obliged to warn the employee about this in writing at least a month in advance) or the employee (he is given the same period of warning).

Denunciation can also occur due to circumstances beyond the control of the parties. This could be, for example, the death of an employee, his conscription into the army or the entry into force of a court verdict, a state of incapacity or partial capacity, etc.

If a person moves to an elective position or one of the parties violates the terms of the agreement, the agreement may also be canceled. But in any case, the employer must issue an act of termination of the contract indicating the reason and return to the employee all stored documents, including the work book.

Termination of the MTPL agreement

There may be many reasons for this, but the termination procedure itself seems complicated and confusing to many. So how to terminate a compulsory motor liability insurance agreement?

First of all, you must write a statement indicating that denunciation is your desire, and also attach to it your passport and compulsory motor liability insurance policy. Within two weeks, the insurance company is obliged to pay a portion proportional to the number of unused days. From the date of the written application, the contract is considered terminated.

Denunciation of the agreement with Rostelecom

How to terminate the contract? With Rostelecom this is as easy to do as in previous cases.

The first thing you need to do is write an application to the specified organization. In it, indicate the reason for termination (failure to fulfill or poor performance of your obligations), for which you, in fact, denounce the agreement unilaterally (indicate the clause of the agreement), and also demand the return of the remaining funds in the account.

The application must be written in two copies, and require that the document that remains with you be stamped and marked with acceptance. The company must provide a written response within two weeks. Here's how to terminate an agreement with Rostelecom at the client's initiative.

The Civil Code of the Russian Federation considers unilateral termination of a contract as a last resort. Any civil agreement includes mutual obligations and rights of all parties. It is quite natural that each of the participants strives to extract maximum benefits and minimize possible costs.

However, circumstances may arise where compliance with agreements becomes unprofitable. In this case, the legislation provides not only for a possible refusal to fulfill obligations assumed, but also for termination of the contract by only one party.

Legal provisions

You can terminate a contractual relationship based on Articles 450-453 of the Civil Code of the Russian Federation. Refusal of existing obligations and termination of all actions is prescribed in Article 310 of the Civil Code of the Russian Federation. These two independent methods are legal options for terminating the contract.

They differ in the following points:

• termination of the contract at the request of only one party is carried out through the courts (clause 2 of Article 450 of the Civil Code of the Russian Federation), and refusal to fulfill existing obligations - in a pre-trial manner (clause 3 of Article 450 of the Civil Code of the Russian Federation);
• These designations have different legal consequences: termination implies the right of one party to demand fulfillment of contractual obligations from the counterparty. Unilateral refusal excludes this possibility.

If the text of the agreement does not specify the method of severing the civil law relationship agreed upon by the participants, the court will be guided by the will of each party when making a decision. This is a risk, as the court verdict may be unpredictable.

It often happens that one participant sends a unilateral termination notice to the other and believes that the business relationship has thus ended and nothing more needs to be done. However, after some time, the other participant goes to court with a claim to collect the debt under the agreement and remains the winner. And all because the termination process was not completed.

Reasons for canceling the deal

The following options may be considered grounds for unilateral termination of the contract:

1. The agreement/law provides for unilateral termination of relations.

2. Significant violations of conditions by the counterparty. For example, one party may experience damage of such magnitude that there is a danger of losing everything that was planned to be received at the conclusion of the contract. Significant violations include the following situations:

• failure to comply with basic obligations. For example, transfer of products to the client, property for temporary use, payment of funds, performance of various works, etc.;
• long delay in execution;
• repeated failure to fulfill obligations (for example, failure to meet delivery deadlines);
• violation of a significant requirement provided for by the transaction or the law in relation to the place, product, time of execution.

As practice shows, assessing a violation is somewhat difficult.

3. Significant changes in circumstances. Circumstances may change to such an extent that if the parties to the contractual relationship could have predicted these changes in advance, they would not have signed such an agreement. Significant changes include deterioration in financial condition, insufficient budget funds, changes in exchange rates, etc.

Other conditions and grounds

Termination of a lease, contract, provision of services, supplies unilaterally is also possible in accordance with Art. 619, 620 Civil Code of the Russian Federation. The agreement must additionally spell out specific reasons for the termination of the partnership, since the court will not take into account the wording “other grounds.” The possibility of refusal without reasons should be specified in detail.

Unilateral termination: features of the procedure

So, there are 2 ways to terminate a partnership:

Extrajudicial. After choosing the basis, the party issues a letter (notification) of unilateral termination of the contract. In accordance with generally accepted rules, it is sent to the other party. You should wait 1 month or the period specified in the agreement.

If there is a response agreeing to the proposal, an appropriate agreement to terminate the contract should be drawn up. The legislation clearly regulates its drafting in a similar form to the contract. The form can be arbitrary, but the content usually reflects the will of the participants.

Result: signing of the agreement and termination of the contract.

Judicial. This method is used when a notification is sent, but there is no response within 30 days.

Sample notification

As a rule, a sample notice of unilateral termination of a contract contains the following information:

• Personal information about the participants in the transaction.
• Document details (number, type and time of signing).
• Grounds for severing contractual relations.
• A list of actions and stages that must be completed by counterparties before termination of interaction.
• Specified deadline for termination and sending a response to the notice.
• Options for solving financial problems.
• Other information that the other party should know.

When sending, an option is selected that will help track delivery of the document being sent. Notice must be sent via postal mail with acknowledgment of receipt.

It is concluded by the parties on a voluntary basis for a certain period. If one of the parties to the contract wishes to terminate it early, then it is necessary to send a letter to the second counterparty terminating the contract for the provision of services.

According to the general rule established in Article 450 of the Civil Code of the Russian Federation, one party cannot refuse the contract without compelling reasons. Termination of an agreement by decision of only one of the parties is permissible through the court only in the following cases:

• In case of serious violations of the contract by another counterparty (violation of deadlines, provision of low-quality services or services not in full);
• On the grounds provided for by the Civil Code, other regulations, or the service agreement itself.

Note! In Art. 450.1 of the Civil Code specifies that if a legislative act or agreement provides for the cancellation of a contract by decision of one participant, then the moment of termination of the contract is the date the other counterparty receives notice of termination of the contract.

Article 450 of the Civil Code of the Russian Federation “Grounds for amendment and termination of the contract” and 450.1 of the Civil Code of the Russian Federation “Refusal of the contract (execution of the contract) or the exercise of rights under the contract”

The possibility of unilateral refusal of an agreement for the provision of services is provided for in a special rule, which applies exclusively to contracts for the paid provision of various services. Thus, Article 782 of the Civil Code of the Russian Federation stipulates that you do not have to go to court if:

• The contract is waived by the customer who has paid the contractor all actual expenses;
• A letter of cancellation of the contract is submitted by the contractor, provided that he compensates the customer for the losses incurred.

If the condition for repayment of the contractor’s expenses or the customer’s losses in connection with the execution of the contract for paid services is not fulfilled, the injured party has the right to appeal the unilateral decision to repudiate the contract in court.

Can be terminated early

Agreement for the provision of services (medical, financial, legal), etc. is concluded for a certain period. Termination of the contract earlier than the established period is possible under the following circumstances:

• Failure to fulfill the terms of the contract due to the fault of one of the participants;
• Circumstances have arisen that do not allow further fulfillment of the contract (for example, relocation, imposition of sanctions, closure of the supplier’s company, etc.).

Note! Termination of the contract ahead of schedule can be carried out by mutual agreement of the parties, which is the most acceptable option for both the customer and the contractor.

You can cancel the contract early either before the start of the service or during the process of receiving it. However, once the service has been provided, refusal is not permitted. Upon termination of the contract, the participants must compensate for damages associated with early cancellation of the contract.

If the parties have not reached a consensus, the contract can be terminated before the expiration of the term unilaterally (based on Article 782 of the Civil Code of the Russian Federation and the provisions of the contract) or by filing a statement of claim in court (if the losses were not compensated voluntarily).

How to write correctly

To cancel a contract for the provision of services, the applicant must send a corresponding letter to the other party. After receiving the notice, the second participant must respond within 30 days.

The form of the letter of refusal of services is not approved at the legislative level, however, this document must contain the following data:

• In the right corner of the A4 sheet the so-called header is indicated: the name and address of the applicant and the recipient of the notice;
• In the middle of the sheet it is written: “Notification”, and on the line below it is specified: “on termination of the contract for the provision of (legal, consulting, auditing, etc.) services;
• The text of the notification contains the details and name of the agreement that was concluded, the name of your organization (or full name of an individual) and the name of the other party to the agreement;
• A reference is made to an article of law and/or agreement, which is the basis for its annulment;
• In the final part, state your requirements or obligations. For example, if the notice is submitted by the customer, it is indicated: “I undertake to pay (cover) all losses incurred in connection with the termination of the contract.” If the contract is terminated due to the guilty actions of the other party, the applicant may demand payment of fines, penalties, interest, which are provided for in the contract;
• Signature of the applicant, seal of the company (if the notification is submitted by a legal entity) and date of preparation of the document.

The notice can be delivered directly to the contractor or customer. In this case, it is advisable to print the letter in two copies and ask for a signature confirming receipt of the letter on your copy.

It is also allowed to send a letter of cancellation of the contract by mail, but always with notification of receipt.

Important! The agreement is considered terminated not from the moment the letter is sent, but from the time it is received by a representative of the customer or contractor.

At LLC "Precedent"

address: Moscow, Lesnaya st., 25, office 34

phone: _____________

from Zarya JSC

address: Moscow, Mira Avenue, 26, office 15

telephone: ______________________________

NOTIFICATION

on unilateral refusal of the contract for the provision of legal services

On June 20, 2016, between me, Alexander Viktorovich Semenov, director of Zorya ZOA, hereinafter referred to as the Customer, and Sergei Viktorovich Sidorov, director of Precedent LLC, hereinafter referred to as the Contractor, an agreement for the provision of legal services No. 1 was concluded, hereinafter referred to as the “Agreement”. In accordance with clause 25 of the Agreement, if the terms for the provision of legal services are violated, the Customer has the right to unilaterally withdraw from the Agreement. In connection with the above fact, we inform you that the Agreement dated June 20, 2016 No. 1 on the basis of clause 1 of Art. 450.1, Article 782 of the Civil Code of the Russian Federation, as well as clause 25 of the Agreement is considered terminated from the moment the Contractor receives this notification. We demand that a sum of money in the amount of 50 thousand 450 rubles (fifty thousand four hundred fifty rubles) be returned by December 1, 2016 for legal services not provided.

10/01/2016 Signature

When to go to court

Despite the fact that the Civil Code of the Russian Federation provides for the possibility of terminating a contract at the initiative of one party, the need to go to court may arise if the contractor or customer refuses to compensate for losses.

However, in order to have the authority to go to court, you must first try to resolve the dispute out of court by filing a notice of termination and a claim for damages.

If the counterparty refuses to cover the material damage within the period specified in the letter, but no later than 30 days from the date of delivery of the notice, you can go to court, be sure to attach a copy of the notice of termination of the agreement for the provision of services to the claim.