Termination Of Construction Contract By Owner And Contractor for Germany

Termination Of Construction Contract By Owner And Contractor Template for Germany

A legally binding document governed by German law that formalizes the mutual agreement between a property owner/client and a contractor to terminate their existing construction contract. This document addresses the terms and conditions of the termination, including final payment settlements, handover of completed works, disposition of materials and equipment, and ongoing obligations such as warranties. It complies with the German Civil Code (BGB), particularly sections 648 and 648a, and often incorporates provisions from VOB/B (German Construction Contract Procedures). The document ensures a clear framework for project closure while protecting both parties' interests under German construction law.

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What is a Termination Of Construction Contract By Owner And Contractor?

The Termination Of Construction Contract By Owner And Contractor is a crucial document used when both parties mutually agree to end their construction relationship before project completion. It is specifically designed to comply with German construction law requirements, including the German Civil Code (BGB) and VOB/B regulations. This document is typically used when circumstances such as project viability changes, funding issues, or mutual recognition of inability to complete the project arise. It provides comprehensive coverage of all termination aspects, including final payments, work handover, material disposition, and ongoing obligations. The agreement ensures legal compliance while protecting both parties' interests under German jurisdiction, addressing key elements such as warranties, documentation requirements, and dispute resolution mechanisms. It's particularly important in complex construction projects where clear documentation of the termination terms and conditions is essential for preventing future disputes.

What sections should be included in a Termination Of Construction Contract By Owner And Contractor?

1. Parties: Identification of the Owner/Client and Contractor, including full legal names and addresses

2. Background: Details of the original construction contract, project description, and circumstances leading to termination

3. Definitions: Key terms used throughout the agreement, including reference to original contract definitions

4. Effective Date of Termination: Specific date when the termination becomes effective

5. Mutual Agreement to Terminate: Express statement of both parties' agreement to terminate the original contract

6. Status of Works: Description of the current state of construction works and percentage of completion

7. Final Account Settlement: Agreement on final payment amount, including completed works, materials, and any adjustments

8. Handover of Site and Materials: Process and timeline for site handover and handling of materials and equipment

9. Release of Obligations: Mutual release from future obligations under the original contract, subject to specified exceptions

10. Surviving Obligations: Identification of contract provisions that survive termination (e.g., warranties, confidentiality)

11. Return of Documentation: Requirements for returning project documents, plans, and permits

12. Governing Law: Confirmation of German law governing the termination agreement

What sections are optional to include in a Termination Of Construction Contract By Owner And Contractor?

1. Dispute Resolution: Include when there are outstanding disputes to be resolved or specific dispute resolution mechanisms needed

2. Intellectual Property Rights: Include when there are specific IP rights to be addressed post-termination

3. Insurance and Bonds: Include when dealing with existing insurance policies or performance bonds that need to be addressed

4. Subcontractor Relations: Include when there are ongoing subcontractor relationships that need to be addressed

5. Warranties and Guarantees: Include when specific warranties need to survive termination or require special handling

6. Confidentiality: Include when specific confidentiality obligations need to be maintained post-termination

7. Press Announcements: Include for high-profile projects requiring coordination of public communications

8. Tax Considerations: Include when specific tax implications need to be addressed in the termination

What schedules should be included in a Termination Of Construction Contract By Owner And Contractor?

1. Schedule 1 - Final Account Statement: Detailed breakdown of final payment calculations, including completed works and adjustments

2. Schedule 2 - Inventory of Materials: List of materials on site, their ownership status, and disposition instructions

3. Schedule 3 - Outstanding Works: List of incomplete works and their status at termination

4. Schedule 4 - Handover Documents: List of all documents, certificates, and warranties to be handed over

5. Schedule 5 - Release of Securities: Details of performance bonds, bank guarantees, or other securities to be released

6. Appendix A - Site Photographs: Documentation of site condition at termination

7. Appendix B - As-Built Drawings: Current state of construction drawings and specifications

8. Appendix C - Quality Documentation: Records of quality tests and inspections completed to date

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Germany

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Commercial Construction

Residential Construction

Industrial Construction

Infrastructure Development

Public Works

Healthcare Construction

Educational Facilities

Retail Construction

Hospitality Construction

Energy and Utilities

Transportation Infrastructure

Mixed-use Development

Relevant Teams

Legal

Construction Management

Project Management

Finance

Operations

Commercial

Risk Management

Quality Assurance

Procurement

Technical Services

Contract Administration

Document Control

Relevant Roles

Construction Project Manager

Contract Manager

Legal Counsel

Chief Financial Officer

Construction Director

Site Manager

Quantity Surveyor

Risk Manager

Commercial Director

Project Engineer

Procurement Manager

Claims Manager

Technical Director

Construction Supervisor

Financial Controller

Operations Manager

Quality Assurance Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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