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It outlines how to avoid wrongful termination findings by addressing contract drafting, notice and cure timing, and post-termination rights covering records, materials, and subcontract assignments. The roadmap further emphasizes reducing delay and cost impacts through supplementation, ensuring strict compliance with required termination bases, and meeting any pre-conditions before exercising termination rights.",{"@graph":63,"@context":119},[64,80,102],{"@type":65,"itemListElement":66},"BreadcrumbList",[67,71,74,77],{"item":68,"name":69,"@type":70,"position":9},"https://docshare.wps.com","Home","ListItem",{"item":72,"name":10,"@type":70,"position":73},"https://docshare.wps.com/template/",2,{"item":75,"name":41,"@type":70,"position":76},"https://docshare.wps.com/template/letters/",3,{"item":78,"name":59,"@type":70,"position":79},"https://docshare.wps.com/template/roadmap-to-a-successful-termination-for-default-ten-essential-steps/280200/",4,{"url":78,"name":59,"@type":81,"image":82,"author":87,"headline":59,"publisher":90,"fileFormat":93,"inLanguage":57,"description":61,"dateModified":94,"datePublished":95,"encodingFormat":93,"isAccessibleForFree":96,"interactionStatistic":97},"DigitalDocument",{"url":83,"@type":84,"width":85,"height":86},"https://docshare.wps.com/thumbnails/roadmap-to-a-successful-termination-for-default-ten-essential-steps/280200.png","ImageObject",442,249,{"name":88,"@type":89},"Melati","Person",{"url":68,"name":91,"@type":92},"DocShare","Organization","application/pdf","2026-10-19","2026-09-16",true,{"@type":98,"interactionType":99,"userInteractionCount":101},"InteractionCounter",{"@type":100},"ViewAction",6,{"@type":103,"mainEntity":104},"FAQPage",[105,111,115],{"name":106,"@type":107,"acceptedAnswer":108},"Why is termination for default considered risky for owners and contractors?","Question",{"text":109,"@type":110},"Termination for default can lead to costly financial consequences and often triggers litigation. If the termination is later found “wrongful” or unjustified, the terminating party may face significant damage claims.","Answer",{"name":112,"@type":107,"acceptedAnswer":113},"What should a properly drafted termination clause define?",{"text":114,"@type":110},"The clause should clearly define the “material breaches” that justify termination for default. It should also specify post-termination rights and responsibilities, including ownership of records, materials, project information, warranties, and rights regarding subcontracts and purchase orders.",{"name":116,"@type":107,"acceptedAnswer":117},"How can a party reduce adverse consequences when termination becomes necessary?",{"text":118,"@type":110},"Use less drastic remedies first, such as supplementing the work crews of the defaulting contractor. Also ensure strict, step-by-step compliance with the contract’s termination process and properly follow required notice, cure, and confirmation steps.","https://schema.org",{"og:url":78,"og:type":121,"og:title":59,"og:site_name":91,"og:description":61},"article",{"robots":123,"canonical":78},"index,follow",{"doc_id":125,"site_id":56},280200,1790380963,{"code":4,"msg":5,"data":128},{"doc_id":125,"user_id":129,"nickname":88,"user_avatar":130,"doc_module":9,"category_id":40,"category_name":41,"doc_title":59,"doc_description":61,"doc_content":131,"file_id":132,"file_url":133,"file_type":134,"file_size":135,"view_count":101,"is_deleted":4,"is_public":9,"is_downloadable":9,"audit_status":9,"page_count":47,"language":136,"language_code":57,"site_id":56,"html_lang":57,"table_of_contents":137,"faqs":138,"seo_title":139,"seo_description":61,"update_tm":140,"read_time":73},962085570644,"https://ap-avatar.wpscdn.com/davatar_994ba38a5ba835b3df7d355c54d3ed8d","ROADMAP TO A SUCCESSFUL TERMINATION FOR DEFAULT  \nBy: Frank E. Riggs, Jr.  \n[frank.riggs@troutmansanders.com](frank.riggs@troutmansanders.com) • 404.885.3353  \nOne of the most difficult, and potentially costly, decisions facing a project owner or contractor is whether or not to terminate for default a contractor’s or subcontractor’s right to complete a construction contract. Even if the decision to terminate seems unavoidable, the steps to be taken in carrying out that termination for default present many opportunities for costly mistakes. Since the termination for default frequently has disastrous financial consequences for the terminated contractor, litigation over the termination decision often awaits the party exercising the termination right. If the termination default is found to have been “wrongful” or unjustified at the end of the day, then the party exercising the termination right may face significant damage claims—including profits lost by the terminated contractor and, perhaps, claims by the terminated contractor for “destruction of business” damages. In addition, the owner or contractor electing to terminate for default must quickly take the steps necessary to minimize the impact of the termination on the project, as well as to insure the collection of any additional costs incurred in completing the defaulted contractor’s work. In today’s difficult economic times, owners and contractors face these termination issues with increased frequency.  \nIn order to assist the owner or contractor in the exercise, or decision not to exercise, termination for default rights, we suggest ten essential steps as a roadmap to the successful exercise of termination rights.  \nStep One: Begin with a Properly Drafted Termination Clause  \nOwners and contractors often learn of the inadequacies of contract termination clausesin the midst of a termination crisis. The time to assess the adequacy of a termination clause is prior to the contract execution. Consider, for example, the following questions which should be asked in assessing your termination clause:  \n• Does the termination clause clearly define the “material breaches” which will justify a termination for default?  \nOnly “material” contract breaches justify a termination for default. Courts will allow contracting parties some leeway in defining what is “material” to a particular contract—take advantage of that opportunity. If a task is especially important to your project, define its proper and timely completion as a “material” contract obligation.  \n• Is the termination notice period reasonable—neither too long nor too short?  \nEven if your contract does not give the contractor or subcontractor the express right to “cure” a default, the law will read that right into the contract. The termination  \n“notice” period becomes the “cure” period. If the cure period is too long, your project suffers as a result of your inability to move with sufficient speed in making a contractor change. If the cure period is too short, you run the risk that a court will subject your termination decision to more careful scrutiny. For example, if your termination clause provides the right to terminate on 24-hours notice, has the defaulted contractor been given any real opportunity to cure the default? If a court concludes that the cure opportunity was illusory, your termination right may be subject to judicial second-guessing.  \n• Does the termination clause speak specifically and adequately to posttermination rights and responsibilities?  \nYour termination clause needs to anticipate some of the practical consequences of a termination. Who owns or has a right to the defaulted contractor’s records, materials, project information, as-built information, and warranty documents? Does the termination clause give you the right to an assignment of subcontracts and purchase orders entered into by the defaulted contractor? What can you require of the defaulted contractor’s performance bond surety? These questions ","cbCaik3tNW4Ex1Qv","https://ap.wps.com/l/cbCaik3tNW4Ex1Qv","pdf",139875,"English","# Step One: Begin with a Properly Drafted Termination Clause\n## Step Two: Consider First the Supplementation of the Defaulting Contractor\n## Step Three: Touch All Termination Bases Carefully\n## Step Four: Satisfy Any Pre-Conditions to Termination Rights","[{\"question\":\"Why is termination for default considered risky for owners and contractors?\",\"answer\":\"Termination for default can lead to costly financial consequences and often triggers litigation. If the termination is later found “wrongful” or unjustified, the terminating party may face significant damage claims.\"},{\"question\":\"What should a properly drafted termination clause define?\",\"answer\":\"The clause should clearly define the “material breaches” that justify termination for default. It should also specify post-termination rights and responsibilities, including ownership of records, materials, project information, warranties, and rights regarding subcontracts and purchase orders.\"},{\"question\":\"How can a party reduce adverse consequences when termination becomes necessary?\",\"answer\":\"Use less drastic remedies first, such as supplementing the work crews of the defaulting contractor. Also ensure strict, step-by-step compliance with the contract’s termination process and properly follow required notice, cure, and confirmation steps.\"}]","Roadmap To A Successful Termination For Default - Ten Essential Steps | PDF",1789534945]