Terminate means rendering an obligation or contract void.
To rescind is to render void a contract or obligation . The action and effect of terminating is known as rescission .
For example: "The player confessed that he wants to terminate his contract with the club to go to Europe" , "Terminating the coach's contract is an option that is too expensive for this team" , "The termination clause exceeds ten million euros" .
Terminate as a judicial declaration
The action of rescinding involves canceling or annulling a legal act that had been previously taken . Termination requires a judicial declaration that acts on the aforementioned obligation.
The limits or scope of rescission depend on each legislation . Generally, the person in whose favor the contract or legal obligation is referred is the one who has the power to terminate it. The other party, however, can also request termination of the contract when there is some reason that warrants it. It will be the Justice , ultimately, who must decide on the viability and correspondence of the interruption of the contract.
When the termination of a contract is requested, a breach of the conditions is often cited. If this is proven, the affected party can demand compensation because the counterparty's faults led to the contract being terminated before the expected deadline.
To terminate a contract it is recommended to have the advice of a lawyer.
Causes that lead to the annulment or cancellation of a contract
There are various reasons that can lead to terminating a contract. However, among the most significant are the following:
- Fraud.
- Lack of capacity. This situation makes it clear that the aforementioned contract may be terminated directly when one of the two parties does not have the capacity that it was considered to possess to undertake the functions that corresponded to it according to said document.
- Material errors on the part of both parties involved.
- When the contractor or the person contracted cannot meet the responsibilities or obligations that had been entrusted to him or her.
- No less important is to establish that, on many occasions, the contract is terminated by one of the two parties considering that the other has not complied with what was established.
- Illegality is also another of the compelling reasons for making the decision to break the contractual agreement.
The role of lawyers
However, in addition to the reasons that exist to terminate the contract, it is important to know the steps that must be followed to carry out said operation. In this sense, in addition to determining the cause that may allow it to be carried out, it should be noted that it is essential to negotiate with the other party and make use of the termination clause if necessary.
All of this without overlooking that all experts advise that, in these situations, it is imperative to consult a lawyer beforehand. This legal professional will be the one who can determine how to terminate the contract as well as the legal consequences that this may entail.
Terminate a contract in sport
In the field of sports , we usually talk about contract termination when a player or coach does not achieve the expected performance or results and, therefore, it is decided to end the contractual obligation.
Often, termination occurs by mutual agreement and neither party sues the other.