Cumulative remedies: Overview, definition, and example
What are cumulative remedies?
Cumulative remedies refer to a contractual provision that allows a party to pursue multiple remedies for a breach or default, rather than being limited to just one. These remedies may include damages, specific performance, termination, or other rights provided under the agreement or by law. The clause ensures that exercising one remedy does not exclude the use of others, unless explicitly stated.
For example, if a party breaches a service agreement, the non-breaching party may terminate the contract and also seek monetary damages.
Why are cumulative remedies important?
Cumulative remedies are important because they give parties flexibility and comprehensive protection in the event of a breach. They prevent the limitation of rights and ensure that parties can pursue all available options to address the harm caused.
For businesses, a cumulative remedies clause strengthens their ability to enforce contracts and recover losses effectively. It also creates clarity by specifying that remedies are not exclusive unless explicitly stated.
Understanding cumulative remedies through an example
Imagine a tenant breaches a commercial lease by failing to pay rent. The lease includes a cumulative remedies clause, allowing the landlord to terminate the lease, sue for unpaid rent, and retain the tenant’s security deposit to cover damages. Without this clause, the landlord might be limited to only one remedy, such as eviction.
In another example, a software licensing agreement states that the licensor can revoke access to the software for non-payment while also seeking legal damages for the unpaid fees. The cumulative remedies clause allows the licensor to pursue both actions simultaneously.
An example of a cumulative remedies clause
Here’s how a cumulative remedies clause might look in a contract:
“The remedies provided under this Agreement are cumulative and not exclusive of any other remedies available under applicable law or in equity. The exercise of one remedy shall not preclude the exercise of any other remedy.”
Conclusion
Cumulative remedies protect parties by allowing them to pursue multiple courses of action in response to a breach or default. This flexibility ensures comprehensive enforcement of rights and reduces the risk of being limited to insufficient remedies.
By including a cumulative remedies clause, businesses can enhance their contractual protections, reduce risks, and ensure they have all necessary tools to address breaches effectively.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.