Contract clauses, one at a time
Each page explains one clause: what it does, a sample written for an invented business, the usual variants, the points worth negotiating and the risk of leaving it out. Sample wording is a starting point, not legal advice.
150 pages, page 7 of 7
Term and termination clauses in a contract
- Term clause in a contract
Most disputes about a term clause are not about its length. They are about the day it started, because a start date tied to an event nobody recorded turns every later deadline into guesswork.
- Termination for cause clause
The word material is doing most of the work in this clause, and most contracts never define it. Naming three or four failures that always count turns a judgement call into something both sides can check against the document.
- Termination for convenience clause
Ending a contract for cause means proving a breach and surviving the argument about whether it was serious enough. A convenience right skips that entirely, and the price of it is agreed up front rather than fought over later.
- Termination for insolvency clause
This is the clause most likely to say one thing and do another in Australia, because a statutory stay has limited when it can be used since July 2018. Knowing which processes it still bites on is the difference between a clean exit and a void notice.
- Termination notice clause
Most failed terminations are failures of process rather than of substance. The right was there, the notice went to the wrong address or the wrong person, and the agreement kept running.
- Transition assistance clause
The value of this clause is entirely in whether it exists before the relationship goes wrong. Nobody negotiates generous exit help on the day they receive a termination notice.