Business Contract Termination Letter And Other Things You Must Know

In the industry, it is a usual thing for a business to start or end a contract with another business. In doing so, it is usually needed for a formal contract, including a business contract termination letter which we are going to discuss deeper here. It is a term that refers to a formal letter to acknowledge one party to terminate the business they are building together.

How to End Business Contract Properly

There’s some proper ways in terminating the business contract. You cannot just simply ‘run’ and abandon the contract. This is why it is very important to make sure what business you are trying to get the contract in the beginning. You can discuss it from the start since it is possible for the other business to also change the agreement. Make the situation benefit both parties. You can also review the contract before giving the final say and accept the agreement. If you are in the middle of the contract, you may need to review the contract once again and try to get help from the lawyer to get through it. It takes time and effort.

Causes of Contract Termination

Before preparing the business contract termination letter, you need to make sure to review the contract and find the loophole of the agreement. These are several causes that might terminate your business contract.

Unfair Contract Agreement

This might happen when there are unfair portions of obligations and rights from both parties. One side will feel they are taken for granted and it may end with the contract termination. For this kind of case, usually a lawyer is needed.

Wrong Information Given

If one party purposely gives false information to make another party sign the contract, there will be a possibility that the contract would be terminated. It happens mostly because there is no thorough review of the contract in the beginning or one party is persuaded under the pressure.

Mutual Agreement

The decision of terminating the contract also happens when two parties reach the mutual agreement to end the business. If one party is not satisfied with the contract usually they release another and terminate the contract. Although it seems that one party is taking decision, it allows the agreement from both parties.

Sample of Business Contract Termination Letter

The sample below is the business contract termination letter from a school that terminates the contract with a foreign language institution.

Dear Mr. Alex,

As per condition of the contract, I would inform you that as of June 1st 2020, it would be the day of contract termination. It is unfortunate that our school would no longer be using the service from Learn English Institution for the TOEFL Preparation for the students. Please accept this two-month notice as stated in our contract.

I really appreciate your great dedication for the past months to teach our students and prepare them to follow the TOEFL Examination. I have been hearing good reviews from the students about how competent and patience the teachers are from your institution and it is always a pleasure to work with your institution. Please feel free to contact our school administrator to renegotiate the contract.

If you have any questions regarding the letter, please call me at (123)-345-678-910. Once again, thank you for the great cooperation you have shown to us.



Frederik Thompson


I hope the sample of business contract termination letter above can give a clear idea of how to write one..

Similar Posts: