On 20 May 2022, the English High Court (the ‘‘High Court’’) made a remarkable judgment under DD Classics Ltd v Chen [2022] on what constitutes a reasonable time period to exercise the contractual right to terminate an agreement due to repudiatory breach before losing such right. The Court’s decision emphasised its initial judgment dated 29 March 2022 (the “Initial Judgment”). The High Court ruled that the choice between accepting a breach and terminating a contract or retaining the contract and waiving the breach is applicable to contractual rights to terminate based on repudiatory breach. Depending on the actual provisions of the contract in question and the interpretation thereof, the termination right shall either be exercised within a reasonable period of time or be exercised at any time if this is expressly stated into the contract…


The decision in DD Classics Ltd v Chen [2022] demonstrates that the parties shall act without delay when seeking to exercise their right to terminate a contract, particularly in cases where the relevant contract does not expressly set out that the right to terminate may be exercised at any time following a triggering event. Furthermore, the continued correspondence and positive acts of affirmation between parties encouraging the performance of the contractual obligations under the contract, which took place after the occurrence of the breach may be interpreted as a waiver of the breach and therefore result in Defendant’s loss of his right to terminate.

To access the Initial Judgment, click here.

To access the judgment dated 20 May 2022, click here.

For more information, and any guidance or advice on exercising termination rights, Cleveland & Co, your External in-house counsel, are here to help.

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