Supply Chain Glossary

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Show Cause


Source: Procurement Glossary
Author: Paul Rogers
Institute: CIPS - UK

Courtesy of


 

When exercising a right to terminate a contract, the buyer is obliged to comply with the provisions in the agreement between the parties as to how the contract may be terminated.  Contracts often include an obligation on the buyer to issue a formal default notice to alert the contractor to any perceived breach of a condition of the contract.  The contract may afford the contractor a reasonable period of time to rectify the breach.  The formal notification from the client to the contractor signalling that the client believes a breach of contract has occurred is sometimes described as a ‘show cause’ notice, as the contractor is invited to show cause why the contract should not be terminated.  As the Courts adopt a ‘non-technical’ approach to the wording of the ‘show cause’ notice the precise wording is not critical, though the recipient should be in no doubt that right to terminate is being exercised.  See also Contract, Termination of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 




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