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Termination Notice with Demand for Damages Template
Clearly terminate the contract and demand damages for breach in one professional, structured letter.
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Termination Notice with Demand for Damages Template
[Your Name or Business Name]
[Your Title, if applicable]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]
Phone: [Phone Number]
Email: [Email Address]
[Date]
[Recipient Name or Business Name]
[Recipient Contact Person, if applicable]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]
Subject: Termination of Contract and Demand for Damages – [Contract / Reference No.: ______]
1. Introduction and Contract Reference
Dear [Mr./Ms./Mx. Last Name] / [To Whom It May Concern],
This letter serves as formal notice that [Your Name or Business Name] is terminating the contract described below due to your breach, and as a demand for damages arising from that breach.
Contract details:
Contract Title / Description: [Contract Title or Short Description]
Date of Contract: [Date of Contract]
Parties: [Your Name or Business Name] and [Recipient Name or Business Name]
Contract / Reference Number: [Reference Number, if any]
2. Contract Obligations and Breach
Under the contract, you were required to:
[Brief description of key obligation 1 relevant to the breach]
[Brief description of key obligation 2, if applicable]
You are in breach of these obligations in the following way:
[Clear description of breach, including relevant dates, missed payments, non-performance, defective performance, late delivery, or other issues]
Any prior communications regarding this breach include:
[Short reference to prior emails, letters, or notices, with dates]
3. Notice of Termination
As a result of this breach, and pursuant to [relevant clause number or “the applicable provisions of the contract”], [Your Name or Business Name] hereby gives you formal notice that the contract is terminated.
The termination is effective as of:
Termination Effective Date: [Date]
From the Termination Effective Date onward:
All further obligations to perform under the contract are ended, except for those that expressly survive termination.
You are not authorized to continue performing under the contract or holding yourself out as an authorized provider or partner under it.
4. Damages Claimed
Because of your breach of the contract, [Your Name or Business Name] has suffered losses and expenses, including but not limited to:
Unpaid amounts owed to us: [Currency and Amount]
Costs incurred to remedy or replace non-performance or defective performance: [Currency and Amount]
Additional expenses directly resulting from the breach (such as rush orders, replacement vendors, storage, or shipping): [Currency and Amount]
Other direct damages: [Short description and amount]
Total damages currently claimed: [Currency and Total Amount]
This amount may be updated if further losses are identified and documented, as allowed under the contract and applicable law.
5. Demand for Payment
We hereby demand that you pay the total damages claimed above in full no later than:
Payment Deadline: [Date]
Payment details:
Bank Transfer:
Account Name: [Account Name]
Bank Name: [Bank Name]
Bank Address: [Bank Address]
Account Number / IBAN: [Account Number / IBAN]
SWIFT / BIC: [SWIFT/BIC]
Payment Reference: [“Damages –” + Contract / Reference Number]
Other accepted payment methods (if used):
[Short description of any other method, such as online payment platform or check mailing address]
6. Return of Property, Confidential Information, or Materials
In addition to the damages payment, you must, by the Termination Effective Date or as soon as reasonably practicable afterward:
Return or destroy any of our property, equipment, or materials in your possession;
Cease using and, where requested, return or securely delete any confidential information or data provided under the contract;
Confirm in writing that these steps have been completed.
Details of items to be returned or destroyed:
[Description of items, data, or materials]
7. Opportunity to Respond or Propose Resolution
If you believe that you are not in breach, that the contract has not been properly terminated, or that the damages claimed are inaccurate, you must notify us in writing on or before the Payment Deadline.
Your written response should include:
Your full name or business name;
The contract reference;
A brief explanation of your position;
Any supporting documents, such as proof of performance, payments, or agreed amendments.
Written responses should be sent to:
Email: [Your Contact or Legal Email Address]
Mailing Address: [Your Mailing Address for Correspondence]
8. Consequences of Non-Payment or Failure to Resolve
If you do not pay the damages claimed or otherwise reach a mutually acceptable resolution by the Payment Deadline, [Your Name or Business Name] may, without further notice, take one or more of the following steps, as permitted by the contract and applicable law:
Pursue recovery of all damages in mediation, arbitration, or court proceedings;
Seek additional damages, interest, and costs to the extent allowed;
Enforce any security interests, guarantees, or other protections relating to the contract;
Notify relevant counterparties or partners that the contract has been terminated due to your breach, where appropriate.
9. Reservation of Rights
Nothing in this letter shall be interpreted as a waiver or limitation of any rights or remedies available to [Your Name or Business Name] under the contract or applicable law. All rights and remedies are expressly reserved, including the right to revise the damages claimed as further information becomes available.
10. Closing
We would prefer to resolve this matter promptly and without the need for formal legal proceedings. However, this letter is intended to clearly confirm termination of the contract and to set out our demand for damages arising from your breach.
If you wish to discuss a possible settlement or payment arrangement, please contact us immediately at [Phone Number] or [Email Address].
Sincerely,
[Your Signature, if printed]
[Your Printed Name]
[Your Title, if applicable]
[Your Business Name, if applicable]
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Easy-to-understand jargon
Easy-to-understand jargon
Easy-to-understand jargon
Details
Learn more about
Termination Notice with Demand for Damages Template
Click below for detailed info on the template.
For quick answers, scroll below to see the FAQ.
Click below for detailed info on the template.
For quick answers, scroll below to see the FAQ.
TERMINATION NOTICE WITH DEMAND FOR DAMAGES TEMPLATE FAQ
What is a termination notice with demand for damages?
A termination notice with demand for damages is a formal letter that tells the other party you are ending a contract because of their breach and that you are seeking compensation for the losses caused by that breach. It usually references the agreement, states the breach, confirms termination, and lists claimed damages.
When should I use this type of letter?
Use this letter when the other party has seriously breached a contract, you have decided to terminate the agreement, and you want to make a clear written claim for damages. It is often used after prior notices or a cure period have failed, or when the breach is serious enough that you are allowed to terminate immediately.
What should this termination and damages letter include?
It should identify both parties, reference the contract, briefly describe the key obligations and how they were breached, clearly state that the contract is being terminated (and from what date), set out the categories and amounts of damages you claim, provide payment instructions, and explain what may happen if the matter is not resolved.
Does sending this letter automatically win a damages claim?
No. This letter states your position and demand, but it does not guarantee that a court, arbitrator, or the other party will agree with your claim. It is, however, an important record that you terminated the contract and asked for compensation in a clear, documented way.
Can I still negotiate after sending a termination notice with demand for damages?
Yes. Many disputes settle after an initial demand letter. Even after you terminate and claim damages, you can continue to negotiate payment plans, partial settlements, or other resolutions, as long as they are documented clearly and do not waive your rights accidentally.
Can AI Lawyer help me customize this termination and damages letter?
Yes. AI Lawyer can help you adapt this Termination Notice with Demand for Damages template by refining the breach description, termination wording, damages breakdown, and follow-up steps. You still provide the real facts and figures and remain responsible for any decision to start or settle a legal claim.
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