Dissolve Agreement

When two or more parties have entered into an agreement, they must fulfill the obligations it contains. That makes sense, but it doesn't always happen. If a party fails to fulfill an agreement, you can do two things (in a nutshell). You can demand compliance, as well as dissolve the agreement. In both cases, you can often compensation progress.

Dissolution of contract in case of default

The law states that any deficiency gives the other party the power to dissolve an agreement. This may be a full rescission, which eliminates the entire contract, but also a partial rescission, for example with respect to a piece of the price to be paid or other performance. Dissolution, however, is not possible if the consequences are not justified in view of the minor importance or shortcoming or in view of its special nature. There may also be rules about dissolution in the contract itself. This is the case, for example, in the NVM purchase deed of a property, which lists conditions that must be met before the house purchase agreement rescinded can be.

Consequences of dissolving agreement

The consequence of dissolution is that both parties are released from their obligations. If those obligations have been fulfilled, then they must be undone. So if payment has been made, then there must be be refunded. But, if the performance cannot be undone then it need not be and the other party must pay compensation for it.

Damages

In addition, the party who dissolves shall be entitled, as against the other party, to compensation for his loss. That can go pretty far. For example, if there is a building contract is dissolved because of a failing contractor, and the client can only find more expensive contractors to complete the work, then the failing contractor is liable for the price difference. 

Lawyer at dissolution of contract

A contract can be terminated by written notice. It can also be claimed in court To rescind an agreement. It is wise to get proper legal advice before dissolving. Because if the rescission is unjustified, you may find yourself in absence comes and liable for damages are. Therefore, consult an attorney in time to discuss the steps in rescinding the agreement.