The Cancellation Of Contract To Sell is a crucial document used when parties mutually agree to terminate their existing sale agreement in Pakistan. This document becomes necessary when circumstances change after the initial contract execution, such as failure to meet conditions precedent, mutual agreement to abandon the transaction, or other valid reasons for contract termination. It must comply with the Contract Act 1872, Sale of Goods Act 1930, and other relevant Pakistani legislation. The document typically includes details of the original contract, reasons for cancellation, financial settlements, mutual releases, and any surviving obligations. It serves to protect both parties' interests by clearly documenting the termination terms and preventing future disputes.
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1. Parties: Full legal names and addresses of both the seller and buyer from the original contract
2. Background: Details of the original contract to sell, including its date, subject matter, and any relevant registration details
3. Definitions: Key terms used in the cancellation agreement, including references to the original contract and any specific terms needed for clarity
4. Cancellation Declaration: Clear statement of mutual agreement to cancel the original contract
5. Effective Date: Specification of when the cancellation becomes effective
6. Financial Settlement: Details of any refunds, payments, or adjustments to be made between the parties
7. Release of Obligations: Mutual release of parties from their obligations under the original contract
8. Governing Law: Confirmation that the cancellation is governed by Pakistani law
9. Execution: Signature blocks and execution requirements
1. Return of Documents: Include when there are physical documents or titles that need to be returned
2. Confidentiality: Include when there's sensitive information that should remain confidential even after cancellation
3. Dispute Resolution: Include when parties want to specify how any future disputes about the cancellation will be handled
4. Surviving Obligations: Include when certain obligations from the original contract should survive the cancellation
5. Third Party Rights: Include when the cancellation affects rights of any third parties or requires their consent
1. Original Contract: Copy of the original contract being cancelled
2. Payment Schedule: Details of any refund or payment arrangements agreed as part of the cancellation
3. Property Details: If the contract involved property, details of the property and any related documents
4. Settlement Statement: Detailed breakdown of any financial settlements between the parties
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