What are the usual grounds?
- Breach not cured within a notice period, such as repeated missed pickups or late payment.
- Convenience: either side may end on notice, sometimes with a fee.
- Failed price review: the parties cannot agree a new price.
- Insolvency of either side.
What do disputes look like?
In 2019 the operator of a Connecticut recycling facility sued the facility's owner, seeking to end their contract without penalty and recover damages, saying incoming contamination far above the contract's assumptions was costing it about $279,000 a month. Whatever the outcome, the case shows why the contamination threshold, how it is measured and the right to end the agreement should be written together.
What should a dispute clause say?
A short escalation: account managers, then senior managers within a set time, then mediation or the courts. Keep paying and collecting undisputed amounts and loads while it runs.
Sample wording
15.1 Termination for cause. Either party may terminate on [30] days’ written notice if the other fails to cure a material breach within that period. Two or more missed pickups in any month is a material breach by Buyer.
15.2 No penalty. No termination fee is payable on termination under 15.1 by Seller.
What to negotiate
- Name missed pickups and late payment as breaches.
- Add an exit if a price review fails.
- Limit early-termination fees to unrecovered equipment cost.
Red flags in a draft
Termination fees equal to the rebate you "would have" received.Termination for cause available only to the buyer.
Questions
- Can I end a recycling contract early?
- Only on the grounds the contract allows. Look for termination for uncured breach, missed pickups and failed price reviews, and check the fee.