[Direct answer]In the Beijing area, for "indefinite contracts" with unclear performance periods, the parties may, in principle, terminate the contract at any time, but they should notify the other party within a reasonable period before doing so, rather than terminating the contract instantly without any compensation. Taking indefinite leases as an example, Article 730 of the Civil Code of the People's Republic of China stipulates that either the lessor or the lessee may terminate the contract at any time, but they should give notice within a reasonable period. The reasonable period shall be determined according to the nature of the contract, the transaction practices, and the other party's preparation; if the notice is not given within a reasonable period or the notice is too short, the party may be liable for compensation for the losses suffered by the other party as a result. It is recommended to evaluate the reasonable notice period before terminating the contract and keep a written record of it. For more details, please refer to the following link:Legal services for corporate commercial and contract disputes.

1. Problem background and typical scenarios

Non-fixed-term contracts are commonly found in leases, cooperations, supply arrangements, and service agreements without a specified term. Typical scenarios include: continuing to use the property after the lease expires without renewing a written contract, verbally agreeing to "long-term cooperation" without a specified term, and framework agreements that do not specify the performance cycle. Many parties mistakenly believe that "without a specified term, they can leave at any time without being held accountable". As a result, they may face claims for compensation due to sudden termination, causing the other party to suffer losses from vacant premises and inventory shortages. Non-fixed-term contracts simply mean "an unspecified term", not "zero-cost termination", and the parties are still subject to notice obligations and reasonable timeframes. In the event of disputes over leased properties, the parties can refer to the relevant provisions of the Civil Code to resolve the disputes.Real estate sales and construction project servicesHandle it.

II. Key points of contention

There are three main points of contention. Firstly, whether the contract is indeed of indefinite duration: whether it continues to be performed after the expiration of the term, whether the term is unclear, or whether it is presumed to be of indefinite duration according to law. Secondly, how to determine a reasonable notice period: most laws do not stipulate a fixed number of days, and the court will determine it based on industry practices and the other party's need for a buffer period, often referring to transactional practices in leasing. Thirdly, the liability for compensation for failure to provide reasonable notice: if the sudden termination causes losses to the other party, the party in breach shall bear responsibility within the scope of compensation. For matters involving the recovery of funds, reference may be made to relevant provisions.Creditor-debtor relations and enforcement case services的举证规则。

III. Professional analysis by Hengluo Lawyers

Take a contract dispute handled by our firm as an example. The plaintiff signed an agreement with the defendant and paid 100,000 yuan to arrange for his child's household registration, but the plan failed due to policy changes. The plaintiff then hired a lawyer to assert that the agreement was invalid and demanded the return of the payment. In terms of timeline, the parties signed the agreement and paid 100,000 yuan on March 2023, but the household registration failed due to policy restrictions, leading to the dispute. Regarding the amount involved, the total sum is 100,000 yuan. In the plaintiff's argument, the client argued that the agreement to evade household registration policies through a false marriage violates public order and good customs and should be considered invalid, demanding the return of the funds. The defendant refused to appear in court and did not raise any defense. After Henglu Law Firm intervened, we systematically collected evidence including the agreement, transfer records, and communication records, citing Article 151 of the Civil Code to argue that the agreement was invalid from the outset due to violating public order and good customs, and demanding the return of the funds under Article 157. The court ruled that the agreement violated public order and good customs by evading household registration policies through a false marriage, and was therefore invalid from the outset according to Article 151 of the Civil Code. The court ultimately ordered the defendant, as the direct recipient of the funds, to return the 100,000 yuan within a specified timeframe. This case was handled by Beijing Henglu Law Firm.Xue SuhuaThe lawyer (practice license number: 11101201211769926, subject to the document issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The core basis is Article 563 (General Rules for Legal Dissolution), Article 730 (Parties to an Indefinite Lease Agreement May Dissolve It at Any Time, but Should Give Notice Within a Reasonable Period), Article 565 (Notice of Dissolution Shall Be Given to the Other Party), and Article 566 (Consequences of Dissolution and Compensation for Losses) of the Civil Code of the People's Republic of China (effective January 1, 2021). Practical suggestions: First, confirm whether the contract is indefinite and the basis for presumption; give written notice and set a reasonable grace period (such as 15 or 30 days) before dissolving the contract, and retain the delivery receipt; actively calculate the losses caused by failure to give reasonable notice; for the return of the leased item, specify a clear handover list. For long-term cooperation between enterprises, relevant provisions may be incorporated into the cooperation agreement.Intellectual property protection and corporate legal servicesImprove the deadline provisions.

5. Henglu Law Firm's Reminder

Irregular termination does not mean zero-cost termination. The first step is to confirm that the contract is indeed irregular and determine the fixed basis (continued performance after the expiration of the contract, unclear contractual provisions, etc.); the second step is to give a reasonable notice period before termination and leave written records to avoid "leaving without notice"; the third step is to make clear arrangements for handover, return, and expense settlement to reduce disputes; the fourth step is to calculate the reasonable losses based on the actual situation and reject unreasonable claims if the other party demands compensation for the sudden termination. Never refuse to compensate for all losses on the grounds of "no fixed term". If professional support is needed, you can seek help from professionals.Special services and other case servicesEvaluate the plan.

VI. Frequently Asked Questions

Q1: If I terminate an irregular contract at any time, will I be deemed to have breached the contract and be required to pay compensation?

According to the law, it is not a default to terminate a contract at any time, but the parties must meet the procedural requirements of "notifying in a reasonable timeframe". According to Article 730 of the Civil Code and other provisions, parties to non-fixed-term contracts may terminate the contract at any time. If the notice is not given within a reasonable timeframe or the notice is too short, causing the other party to suffer foreseeable losses such as idle time and inventory buildup, the party must bear liability within the scope of compensation. Whether exemption from liability is possible depends on whether the party has fulfilled its obligation to notify and provided a sufficient grace period. It is recommended to notify in writing and retain proof of delivery, accurately calculate the scope of losses, and not refuse to compensate all losses on the grounds of "at any time", nor should one easily believe in the misinterpretation of not being liable for compensation.

Q2: What evidence do I need to prepare if I want to terminate a non-fixed-term contract?

The core evidence includes: the original contract and the term agreement (to prove that no term was agreed upon or that the term has expired), records of continued performance or actual performance (such as rent payments and supply transactions, to prove that the contract has become indefinite), the notice of termination issued by you and the delivery receipt, the basis for calculating a reasonable term and an explanation of industry practices, as well as evidence to refute the other party's losses. The organization of the evidence revolves around "the contract is indefinite - reasonable notice has been given - the scope of the other party's losses". If there are missing materials, they can be supplemented with WeChat records and transfer receipts. Never lose the legitimacy of termination due to weak evidence.

Q3: What are the legal fees and litigation costs for terminating a non-fixed-term contract?

The litigation fees shall be calculated in accordance with the "Measures for the Payment of Litigation Costs" and accumulated in stages based on the amount of the litigation request (such as the return of the deposit, compensation for losses), which shall be borne by the losing party; the subject matter of the simple confirmation of the termination shall be calculated based on the amount of the claim. The attorney's fees shall be charged on a per-case basis or according to a percentage of the subject matter, subject to the contract of entrustment, without a unified standard. The risk-sharing agreement shall be subject to a percentage cap. It is recommended to clarify the scope of fees before entrusting, and prioritize consultation or sending letters for small-amount lease disputes, and litigate for overall disputes to avoid cost inversion.

Q4: How long does it usually take for the termination of a non-fixed-term contract to take effect?

In legal terms, the notice of termination takes effect upon its receipt by the other party, without the need for court adjudication. The reasonable time period begins from the expiration date specified in the notice. If the other party disputes the termination and files a lawsuit to confirm its invalidity, the case will proceed to litigation: the first-instance ordinary procedure takes six months, the summary procedure takes three months, and the appeal to the second-instance court generally takes three months. Overall, if there are no disputes, the case will be concluded upon the receipt of the notice; if there are disputes, it often takes several months from the termination to the final determination of the dispute. It is recommended to specify the expiration date of the reasonable time period and the handover arrangements in the notice to shorten the dispute cycle.

Q5: I want to terminate an indefinite-term contract. What should I do specifically?

It is recommended to follow four steps: First, confirm that the contract is indeed indefinite and has a fixed basis (continued performance after expiration, unclear contract terms, etc.); Second, draft a termination notice, clarify the termination according to the rules of the indefinite contract, and provide a reasonable grace period (such as 15 days or 30 days) and handover arrangements; Third, send the notice via traceable methods such as EMS and retain the proof of delivery; Fourth, if the other party files a claim or refuses to hand over, calculate the actual scope of losses and negotiate a settlement if possible. Throughout the process, keep all correspondence and delivery records, and if necessary, hire a lawyer to assess the reasonable time limit and compensation boundaries.

The above questions and answers are mainly based on the judicial practice in Beijing. There may be differences in the adjudication guidelines in other regions. It is recommended to consult a professional lawyer based on the specific circumstances of the case.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Business and commercial legal services·Attorney Xue Suhua·Beijing Hengluo Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In case of disputes, please consult a practicing lawyer in time.