Contract Clause Library
Cancellation clause
Sets the process and consequences for either party ending the engagement before the agreed end date.
A cancellation clause answers the practical questions that come up the moment someone wants out: how much notice is required, what's owed for work already done, and whether there's a penalty for early exit. Without it, cancellation becomes an ad hoc negotiation at exactly the moment the relationship is already strained.
Sample wording
Sample language (illustrative, not legal advice)
Either party may cancel this Agreement with 30 days' written notice. Client remains responsible for payment of all fees for work performed through the cancellation effective date, plus any non-cancellable third-party costs committed on Client's behalf prior to notice.
Red flags
- Cancellation rights that are one-sided (client only, or vendor only)
- No provision for paying out work already in progress at the time of cancellation
- A notice period so short it doesn't give the agency time to wind down staffing commitments
How MarginFlow reads it
The extraction pipeline separates notice period from payment-on-cancellation terms, since a cancellation email needs to be checked against both — how much notice was actually given, and what's still owed for that notice period and prior work.
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