Contract cancellation minutes are one of the documents that often appear in businesses. Business deals are not always smooth sailing. So the appearance of the contract termination minutes is also quite normal.
So do you understand the issues related to contract cancellation? If not, please join AequitasAudit.com to immediately refer to the following shares
Contract cancellation minutes and things to know!
1. What is a contract cancellation record?
A contract is one of the documents committed to a certain transaction and has legal effect. Contracts are usually transacted in two forms, in writing or orally (with witnesses). So,
Under what specific situations is the contract cancellation record made?
- Either party violates 1 or more terms of the signed contract
- One of the two parties does not fulfill the agreed responsibilities, causing the contract to fail to achieve the signed purpose. The aggrieved party will have the right to cancel the contract and demand compensation from the other party
These situations have been mentioned in Article 423 of the Civil Law 2015. Therefore, you can also unilaterally terminate the contract when encountering the above situations.
2. Cases in which contract cancellation is allowed
Cases of contract cancellation are mentioned in the Civil Code 2015 from articles 424 to 426. Specifically as follows.
Article 424 of the Civil Code 2015
To cancel the contract in case either party is late/failure to perform the obligations. One party fails to perform or fails to perform the agreed-upon obligations on time. Thus, the other party will have the right to cancel the signed contract
Article 425 of the Civil Code 2015
This Article 425 clearly states that, if one of the parties is unable to perform the contract, the remaining parties have the right to cancel. The remaining parties have the right to cancel the contract as well as may claim compensation for losses caused by the breach.
Article 426 Civil Code 2015
This law states that, if one party causes property damage or loss, the other party has the right to cancel the contract. If Party A causes damage or property damage, Party B has the right to make a record of contract cancellation.
In addition, Party A must also compensate for damage equivalent to the value of the damaged/damaged property. Or Party A needs to compensate according to the agreement. But if the property is damaged due to a force majeure event, the violating party will not have to compensate.
3. What are the consequences of canceling the contract?
As the information shared above, the contract cancellation will inevitably cause serious consequences.
- The contract will terminate immediately after the contract cancellation minutes are made. The contracting parties will not need to continue to perform the previously signed contracts. Issues in dispute settlement as well as rights and obligations need to be implemented according to the agreement.
- After the minutes of cancellation of the signed contract take effect, the parties can still claim the benefits they have made. And both parties will at the same time have to return the benefits or goods previously delivered or received.
- The breached party has the right to request the breaching party to compensate for the damage.
How to distinguish between contract cancellation and void contract
In general, both of these forms are related to the contract cancellation record. However, in reality, the two forms of contract cancellation have different points. Specifically like,
Contract cancellation minutes
Conditions for cancellation are based on article 423 of the 2015 Civil Code. It is a violation of the conditions agreed upon by the parties; Violation of contractual obligations or other violations prescribed by law. In terms of nature, contracts are not recognized at the time when the factors to cancel the contract arise.
Legal consequences of making a contract cancellation record as mentioned above. The violating party may have to compensate for the consequences, depending on the serious nature of the violation or as prescribed by law.
The authority to decide on handling after signing the contract cancellation minutes is one of the parties. If it is a record of cancellation of an economic contract, it will be decided by the court or arbitrator.
In case the contract is void
Is a violation due to fraudulent acts, violations of the prohibitions of the law, by mistake, by being deceived – threatened … Void when the contract maker is underage, who is not aware and does not do behavior master. In addition, those who have limited civil capacity or are unable to comply with formalities.
Consequences of voidable contracts
The voidable contracts have never arisen about the obligations or rights of the parties who have signed the contract. The consequences often lead to the parties having to restore the original condition, the party at fault will have to compensate. At the same time, the parties will have to return the benefits/properties received.
Jurisdiction over voidable contracts is arbitration or the courts.
The distinction between the two situations above will help the parties ensure their interests when entering into the contract.
What are the procedures for canceling the approved contract?
How does the contract cancellation record take effect? You need to carry out notarization procedures according to the provisions of the Law on Notarization 2014.
Submit the contract cancellation record to the previous notary office
Especially the sample documents to cancel the real estate sale and purchase contract. You need to bring it to a notary office that has notarized the contract. The notary will check whether the documents in the dossier are sufficient or not?
Some of the documents required in the application
- The notarization request form has all the necessary information
- Draft contract or transaction
- Copies of the identity documents of the notarization requester
- Documents certifying ownership, right to use or other legal documents on property
- Copies related to contracts and transactions to be canceled
If the application is not complete, the notary will guide you to supplement it. If it is complete according to regulations, they will accept it.
Re-read the contract minutes
The notary will read it back to you/the notarization requester, or you can actively read it and check it again
Sign each page of the contract, transaction
After carefully checking the information, read it again, you sign each page of the contract or transaction. The notary will ask you to present documents for comparison before recording the testimony.
>>> You may be interested: How tight is the rental contract?
With the above information, you will surely know the information related to the contract cancellation minutes. You will understand the consequences of canceling contracts and transactions. Hope you will be more careful before the factors related to signing contract transactions.
– Van Anh (Content Writer) –