Terminating any relationship can be painful. For contractual parties, an incorrect or even careless termination may result in costly legal consequences. Two recent cases highlight the development around this body of law and serve as an aide-mémoire of the principles underpinning termination under English law:
- Bains v Arunvill Capital Ltd reminds parties committing remediable breaches, those which are deemed cured if remedied within a specific time period, that a mere expression of an intention to carry out (as opposed to the actual performance of) contractual obligations (and where those obligations are so apparent) will not be enough to remedy a material breach.
- Attorney General of the Virgin Islands v Global Water Associates Ltd reminds parties seeking to terminate and recover “lost profit” damages of the requirement for such losses not to be too remote. In such cases, courts will look particularly at the parties’ specific knowledge and expectations at the time of formation of the specific contract.