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X11

Termination by the Client on notice

Reviewed by LazyQS Editorial·Last reviewed: 2026-02-19

Plain English Explanation

X11 gives the Client the right to terminate the contract at any time by giving notice to the Contractor, without needing to demonstrate fault on the Contractor's part. This is a 'termination for convenience' clause. If the Client terminates under X11, they pay the Contractor their actual Defined Cost incurred, plus the Fee, plus a termination fee as stated in the Contract Data.

Without X11, the Client can only terminate for specific reasons (like Contractor insolvency or default). X11 is therefore a significant additional right for the Client — and a risk for the Contractor, who cannot guarantee the project will run to completion.

The termination fee under X11 is designed to compensate the Contractor for lost profit on the uncompleted works. The adequacy of this fee should be reviewed carefully at tender stage.

Key Takeaway

The termination fee under X11 is rarely adequate to compensate for lost profit on the full remaining works — negotiate a higher fee or a longer notice period before signing, not after you receive a termination notice.

What This Means for Subcontractors

If X11 is in the main contract, the main contractor may include an equivalent termination for convenience right in the subcontract. This means you could be terminated at any time, even if your work is proceeding perfectly. The termination fee in your subcontract should compensate you for your lost profit on the remaining works — negotiate this carefully, especially if you have made significant upfront investment.

Common Risks & Disputes

  • 1Termination fee being too low to compensate for lost profit on remaining works
  • 2Subcontractors being terminated for convenience without adequate notice, leaving resources stranded on site
  • 3Supply chain commitments made in advance of termination not being recoverable
  • 4X11 not being passed down to subcontractors, creating a mismatch in the main contractor's risk position
  • 5Dispute about what constitutes the correct Defined Cost at the point of termination

Sources

  1. NEC4 ECC Secondary Option X11— NEC4 ECC
  2. RICS Guidance Note: Termination for Convenience Provisions in NEC4— RICS
  3. Fenwick Elliott: Termination for Convenience in Construction Contracts— Fenwick Elliott
  4. Society of Construction Law: Termination Rights in Standard Form Construction Contracts— SCL

Related Clauses

X4

Parent company guarantee

Parent company guarantee — both are additional Client protections in termination scenarios

X13

Performance bond

Performance bond — another security provision that interacts with termination rights

Continue Learning

Category Overview

Back to X Clauses (Secondary Options)

Adjacent Clauses

X10 Information modelling (BIM)X12 Multi-party collaboration

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