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Is it ever OK to break a contract?

Whether you’ve signed a contract for an employment position, a rental lease or a business agreement, you probably know that contracts are binding documents that hold you to your end of the deal. If you break the terms of the agreement, it is known as a breach of contract and may lead to a contract dispute. For Cincinnati residents who fail to uphold their end of an agreement, this type of litigation may not go in their favor.

How do you protect yourself if you feel you need to break the contract? Is there ever any reason that terminating a legally binding contract is permissible?

To simply illustrate, we’ll use an example of terminating an apartment lease. U.S. News has provided a few points on successfully breaking such a contract with a reduced risk of legal repercussions. Like any contract, an apartment lease should have terms that protect both parties who have signed. Also like other contracts, it may be possible to terminate the lease under the following conditions:

  • The contract contains an opt-out clause that allows either party to cancel the agreement under certain conditions, such as circumstances out of your control that are forcing you to move.
  • Your landlord may be reasonable and compassionate, and agree to allow you to break the contract if you have no other choice, such as if you become injured or ill and can’t pay the rent.
  • You are able to find someone else to take over the remainder of your lease and live in the apartment in your stead.
  • Conditions have rendered the apartment uninhabitable, or you have proof that your landlord is not upholding his or her end of the agreement or is conducting business illegally.

You can see that any of the above points may be applicable to other types of business contracts, such as hiring a contractor to do work on your home or making a major purchase. Before deciding to terminate a contract, it would be in your best interests to carefully read each point in the agreement and determine which, if any, penalties you would face for a breach or early termination. In a best case scenario, you and the other party would be able to come to a mutual agreement. This information is not meant to be taken as legal advice.

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