Opportunity to remedy: Overview, definition, and example
What is the opportunity to remedy?
The opportunity to remedy refers to the provision in a contract that gives one party the right to correct or fix a breach or failure to perform within a specified period before further action (such as legal proceedings or penalties) is taken. This clause typically allows the party in breach of the contract to "cure" or resolve any issues that have arisen, whether it involves fulfilling obligations, paying overdue amounts, or correcting non-compliance.
The goal of the opportunity to remedy clause is to provide fairness and give the party in breach a chance to address the problem before severe consequences, such as termination of the contract, are enforced. It helps maintain business relationships and encourages resolution without immediate escalation.
Why is the opportunity to remedy important?
The opportunity to remedy is important because it encourages cooperation between the parties to a contract, helping them avoid jumping directly to termination or other extreme remedies. It provides a mechanism for resolving disputes or issues before they escalate, offering both parties the opportunity to negotiate and fix the situation without resorting to legal action.
This clause is beneficial for both parties in maintaining a working relationship, offering a fair chance to resolve issues amicably and efficiently. It reduces the risk of unnecessarily severing contracts or relationships and can ultimately save time, money, and effort.
Understanding the opportunity to remedy through an example
Let’s say a tenant has missed several monthly rent payments as outlined in their lease agreement. According to the "opportunity to remedy" clause, the landlord must first provide the tenant with a notice informing them of the missed payments and give them a specified period (e.g., 10 days) to pay the overdue rent. If the tenant pays within the remedy period, no further action is taken, and the tenant can continue to occupy the property.
In another scenario, a business providing services under a contract is failing to meet deadlines for delivering the product. The contract might include an "opportunity to remedy" clause, requiring the service provider to correct the delays within a reasonable period (e.g., 15 days) before the client has the right to terminate the agreement or seek damages. If the service provider corrects the issue within the allowed time, the contract continues without further consequence.
Example of an opportunity to remedy clause
Here’s how an opportunity to remedy clause might appear in a contract:
“In the event of any breach of this Agreement, the non-breaching party shall provide written notice of such breach to the breaching party. The breaching party shall have [Insert Number] days from the date of notice to remedy the breach and fully comply with the terms of this Agreement. If the breach is not remedied within the specified time, the non-breaching party may pursue further legal action, including termination of this Agreement.”
Conclusion
The opportunity to remedy clause is a useful and often essential provision in contracts, allowing the party in breach a chance to resolve issues before further penalties or termination occur. It helps to ensure fairness and fosters positive relationships by encouraging resolution of disputes without immediate drastic measures. By including such a clause in agreements, businesses can avoid unnecessary conflicts, minimize legal costs, and maintain ongoing partnerships or agreements.
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.