Contractors' Questions: Can I cancel a signed contract?

Contractor's Question: I have just accepted a contract to supply my services. I signed this contract last week but have not started yet. Today I have received another offer a contract, which is more local to me. Can I cancel the first contract and accept this new, more preferred contract? If it depends on the contract, what wording or type of clause should I be looking for? And can the agency/client of the first contract take any action against me if I opt for the alternative offer!

Expert's Answer: It is not advisable to cancel the contract (or not perform the contract) unless there is a clause in the contract that allows you to do so. This will be headed (for example) 'Termination'. If you do not honour the contract, it could be argued that the commercial party/end-user may suffer (i.e. if they cannot complete a job on time because they are relying on your services) and they may claim damages against you. Therefore the contract really needs to be reviewed to see if you can (and if so how) cancel the contract.

That said, it might be worth calling the client/agent and simply asking if you can be excused from the contract. It may be that they have other candidates who could come in and do the job and, therefore, the end-user may not be troubled by it.

The expert was Jody Tsigarides, of Lawdit Solicitors.

Sunday 14th Mar 2010