The economic activity of each of the business entities requires constant registration of their obligations in relation to each other. They are legalized by agreements (contracts), the agreed parties are responsible for their implementation. All relations between individual business entities are governed by the contract and applicable law.
Decision on early termination of the parties' agreements
Under the influence of a changing market, in the event of difficulties or the inability to fulfill one's own obligations in accordance with the agreements, a situation arises when one of the parties requires early termination of the contract. The contract shall be terminated before the specified deadlines are reached when its performance becomes economically disadvantageous to one or all of the contract holders. The main thing is not to confuse the early termination of the contract with force majeure, when one of the parties has force majeure to fulfill its obligations.
Termination of the contract at the proposal of one of the parties
The provisions of the Civil Code of the Russian Federation stipulate that the unilateral refusal to fulfill obligations under the contract is unacceptable with the exception of individual cases. If an agreement between the contracting parties allows unilateral early termination of the contract, then its procedure must be clearly stated and strictly observed, otherwise the parties must be guided by the Civil Code and other acts regulating economic relations.
Registration of the termination of economic relations
Each case of termination of economic relations must be formalized by agreement. If necessary, execute legally competent early termination of the contract, a sample agreement can be found in the legal literature. From a legal point of view, an agreement between the parties on the termination of economic relations before the expiration of the originally agreed period of validity is also a contract, which means that it covers all the rules for processing commercial documents.
Moreover, if the contract is concluded orally, the termination can be oral, if in writing, then only in writing, if notarized, then the termination must be notarized, if state registration was required, then information on the termination of economic relations should be entered in the corresponding register.
Termination Procedure
A notice of the decision to terminate the contract before the expiration of the agreed period of validity is sent to its other holders at least 30 days in advance. When the deadlines for the submission of such an application are specifically stipulated by agreements or legislative acts, the moments of submission and termination must be precisely observed. In case of refusal to sign the agreement on the termination of the contract, the party initiating the termination has the right to appeal to the court.
If she decides that the grounds for termination of the business relationship are material, then they are terminated from the date specified in the initial notice. The law of the Russian Federation does not provide for going to court for a decision to terminate a transaction without going through the preliminary notification procedure of other subjects of the agreement.
Termination of the agreement by agreement of all parties to it
In economic practice, situations arise when all contracting entities would like to reach an agreement on the termination of economic relations. This, as a rule, simplifies the process of drawing up a document on the termination of a contract, especially when the parties have not commenced its execution or have not fully performed it, except in cases of unresolved claims. In this case, it is necessary to enter all the conditions into the agreement on early termination of the contract, after which the parties will not have claims to each other.
Other cases of termination of business relations
Termination of obligations occurs during bankruptcy or liquidation procedures of a legal entity that is one of the parties to the contract, as defined by the Civil Code of the Russian Federation. The agreement or contract may be terminated at the initiative of a third party. The bodies authorized to suspend and cancel its action, the laws of the Russian Federation defined the prosecutor's office and the tax service. State supervision authorities intervene in the execution of the contract in cases determined by law, when the agreement harms the state, citizens or other legal entities, as well as if the actions under the contract are unlawful.
In any case, such measures are applied only on the basis of a court decision. The list of conditions for the early termination of the contract can be expanded by the parties at the time of the conclusion of the agreement; by law, in the Russian Federation there are no such direct restrictions. In this case, the provisions of the laws on early termination shall enter into force, unless otherwise specified by economic agreements.
Early termination of the insurance contract
Termination of the risk insurance contract in accordance with the Civil Code of the Russian Federation can be made at the initiative of each of the parties. Termination of insurance under the policy occurs in cases of expiration of the insured risks. For example, if we are talking about transaction insurance or entrepreneurial activity, then the reason will be the completion of those. In this case, the insurer may claim a certain part of the insurance premium stipulated by the contract in proportion to the duration of the risks. At the initiative of the insured, early termination of the insurance contract allowed at any time, however, the insurance premium is not refundable, unless otherwise provided by agreement.
In this case, the policyholder is obliged to clearly inform the insurer about the termination of the contract from a certain moment and to achieve written confirmation of termination. Otherwise, the latter may demand reimbursement of the premium that has not been received for the entire insurance period, which was originally agreed upon, although the former may also require payment of a policy through the court when an insurance event occurs. Thus, the policy will terminate only after mutual confirmation of the parties.
Early termination of the service contract
At the proposal of either party to the agreement on the provision of paid services, its effect may be terminated earlier than the agreed date. At the initiative of the customer - subject to full payment of work and expenses incurred by the contractor at the time of termination of the document. At the initiative of the contractor, early termination of the service contract is possible provided that the customer is fully compensated for the losses incurred due to non-performance.
Termination of Delivery Contracts
Early termination of the supply agreement is possible by decision of any of the subjects of the transaction. On the part of the buyer, provided that:
- the delivery of goods of inadequate quality was carried out, there is no way to eliminate the shortcomings in terms acceptable to the buyer;
- the supplier regularly disrupts the delivery time of the goods, thereby damaging the commercial activities and reputation of the buyer.
In turn, the supplier in accordance with the Civil Code of the Russian Federation has the opportunity to terminate the contract unilaterally if:
- the buyer constantly violates the terms of payment;
- constantly lacks declared volumes of goods.
The moment of termination of the contract is the date of notification by the initiating party of the second party, unless otherwise specified in the agreements previously concluded by the parties.
Termination of employment
In accordance with the Labor Code of the Russian Federation, early termination of the employment contract by the decision of the employer is possible if:
- unsatisfactory completion of the probationary period with the obligatory notification of the employee at least 3 days before the termination of the contract and the obligatory indication of the reasons why the employer considers the test to be failed;
- reduction in the number of working personnel, as well as in connection with the liquidation of a business entity;
- inconsistency of the position held by the employee based on the results of verification or certification;
- repeated violation of discipline and work duties by an employee;
- for executives, the reason for dismissal may be a change of ownership of the enterprise;
- disclosure of protected secrets or personal data of other employees;
- loss of employer confidence for workers with access to wealth;
- offenses established in the manner prescribed by law;
- the provision of false documents or false information during employment;
- in other individual cases provided for by the legislation in force in the Russian Federation.
The employment relationship may be terminated at the request of the employee, provided that the employer is notified in writing at least 2 weeks before the time of separation, unless otherwise provided by the laws of the Russian Federation. It is also possible to end the employment relationship before the expiration of the agreement by agreement of the parties.
Termination of lease ahead of schedule
Immediately, we note the fact that changes in the validity period of the lease of property rights to the leased object are not grounds for breaking the lease and revising its conditions. Early termination of the lease by the lessor is possible if the lessee:
- Repeatedly violated the conditions for the use of property stipulated in the contract, or used the property for other purposes.
- Two or more times in a row violated the terms of payment for leased property.
- Leased property significantly deteriorated.
- It does not carry out maintenance and repair of leased property in the terms and volumes stipulated by the terms of the contract.
In the event that the termination of the lease ahead of schedule does not suit the tenant, he goes to court. An application for violation of the order of use, payment, damage, destruction of leased property may be submitted by the plaintiff for consideration in a judicial proceeding with a claim for compensation for losses and damage.
Lease termination ahead of schedule is possible at the suggestion of the tenant under the following conditions:
- the landlord did not provide conditions for the transfer, use of the leased property or access to it;
- the owner does not perform maintenance and repair of property stipulated by the terms of the contract;
- the property leased out had hidden defects that impeded its intended use;
- the property has come into a condition unsuitable for operation for reasons beyond the control of the parties to the contract.
Any of the parties has the right to demand the early termination of economic relations in case of unfair performance of their obligations by the other party, leading to significant losses.The procedure for termination of the agreement assumes that when identifying circumstances that impede its execution, the initiating party sends an application for early termination of the agreement, which must be accepted by the other party. If no agreement is reached, termination is possible by court order. It is very important to correctly and accurately document all breaches of contractual obligations and your actions. This will avoid unnecessary difficulties in the process of early termination of the lease.
Legal implications for subtenants
If a sublease agreement has been concluded on the basis of a lease agreement, the subtenant has the right to insist on concluding a lease agreement with him (in exchange for the sublease agreement) for the entire remaining period according to the main document. Only if the court declares the lease agreement void, does the subtenant not have this right.
Features of the termination of the contract for the rental of accommodation
Russian law interprets the lease agreement as a special case of rental, in which the property is transferred for temporary use to a private person. At the same time, early termination of the rental agreement is proposed at the proposal of one of the parties. A homeowner can initiate a breakdown for the following reasons:
- non-payment for 6 months;
- damage to the premises by the tenant, as well as by persons for whose actions he is responsible;
- the room has become unsuitable for living;
- the rights of other residents of the house are violated;
- misuse of housing.
When applying to the court, as a rule, a decision is made to eliminate the indicated defects by the tenants within a certain period (usually one year). And only after repeated appeal, provided that the reasons for the claims are not eliminated, the court can decide on early termination tenancy agreement and eviction of tenants from it. At the same time, the tenant and the persons living with him are obliged to vacate the occupied premises.
