Contract Law

Ceasing the Contract


Parties can terminate a contract at will, within what is permitted by the contract terms. When a party simply ceases performing their obligations under a contract, this called repudiation. They may state that they are ceasing to perform, or it may be implied by a period of non-performance.


Upon repudiation, the other party can then terminate the contract if they wish. They may sue for damages or for specific performance. (See later) to be compensated for what they would reasonably expect to receive had the contract been performed in full.


Repudiation can happen lawfully if the counter-party breaches an essential term, but not a minor term. The case for intermediate terms depends on the situation. The seriousness of the breach is also a factor. Termination can also occur lawfully for unreasonable delay.


In other circumstances, if you terminate prematurely, then you are the party guilty of repudiation and can be sued. It is possible to terminate by mutual agreement at any time. A contract may also contain terms specifying that it is to be terminated once certain conditions are met.


In Associated Newspapers v Bancks[1] Bancks the creator of Ginger Megs among other cartoons, signed a 10 year contract in 1949 with Associated Newspapers. He was to draw cartoons and they would be published on the first page of the cartoon section of two newspapers. Associated Newspapers eventually moved the cartoons to the third page without consent and against protest. Bancks gave notice of termination...








[1] Associated Newspapers Ltd v Bancks (1951) 83 CLR 322.