If you have entered a contract with another party, you are obligated to abide by the terms and conditions of the contract. Any failure to perform an obligation required by the contract, including if you don’t complete an obligation within a time limit set by the contract, will be a breach of contract.

If a breach of contract occurs, what happens next can depend on the type of term breached and other laws that might apply to the specific contract.

Understanding share sale agreements is essential for corporate clients navigating the sale of shares in Australian businesses. Investors and entrepreneurs should familiarise themselves with typical provisions found in share sale agreements and be aware of important considerations and best practices in a share sale transaction. Seeking the guidance of an experienced lawyer is crucial in protecting their interests and achieving a mutually beneficial outcome.

A “Heads of Agreement” is one of those legal terms that you may come across for the first time and find yourself doing a quick Google search. To make things more confusing, the term is sometimes used interchangeably with terms such as “Letters of Intent” or “Memorandum of Understanding”.

So, what do these terms actually mean?

A penalty clause is a term in a contract that imposes a penalty on a party that breaches a contractual obligation. It is important to know that penalty clauses are generally unenforceable under Australian law. However, it can sometimes be difficult to distinguish penalty clauses from other similar clauses that are enforceable.