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Final Payment Release Letter Template for England and Wales

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Key Requirements PROMPT example:

Final Payment Release Letter

"I need a Final Payment Release Letter for a completed construction project with ABC Builders Ltd, confirming receipt of final payment of £250,000 and releasing all claims except for latent defects, to be executed by March 2025."

Document background
The Final Payment Release Letter is a crucial document used when concluding contractual relationships under English and Welsh law. It is typically issued when all works or services have been completed and the final payment is being processed. The document confirms receipt of the final payment and provides a comprehensive release of all claims, disputes, and obligations arising from the contract. It offers protection to both parties by creating a clear record of the contract's conclusion and preventing future claims, except for those specifically reserved. This document is particularly valuable in complex commercial relationships where clarity about the final settlement is essential.
Suggested Sections

1. Letter Header: Date, recipient details, reference numbers

2. Project/Contract Reference: Details of the original contract or project, including relevant dates and parties

3. Payment Amount: Confirmation of final payment amount and payment details

4. Release Statement: Clear statement of release of claims and obligations under the contract

5. Signature Block: Authority to sign and execution details for all parties

Optional Sections

1. Retained Rights: Section specifying any rights that are specifically preserved despite the release

2. Conditions Precedent: Section detailing any conditions that must be met before the release becomes effective

3. Third Party Rights: Section addressing the impact on rights of third parties and any related provisions

Suggested Schedules

1. Payment Schedule: Detailed breakdown of final payment amount and any outstanding payments

2. Outstanding Works List: List of any minor items or works still to be completed post-release

3. Authority Documentation: Evidence of authority to sign and supporting corporate documentation

Authors

Alex Denne

Head of Growth (Open Source Law) @ ºÚÁÏÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



















Clauses















Industries

Housing Grants, Construction and Regeneration Act 1996: Key legislation for construction contracts that governs payment provisions and procedures in construction projects

Late Payment of Commercial Debts (Interest) Act 1998: Legislation governing statutory interest and compensation for late payments in commercial transactions

Limitation Act 1980: Sets time limits for bringing claims and is crucial for ensuring the release doesn't conflict with statutory limitation periods

Law of Contract: Common law principles covering consideration, intention to create legal relations, and capacity to contract

Doctrine of Accord and Satisfaction: Common law principle governing full and final settlement arrangements and release of claims

Law of Release: Legal principles concerning waiver of rights and discharge of obligations

Companies Act 2006: Legislation governing corporate authority to sign documents and corporate capacity

Insolvency Act 1986: Legislation affecting the validity and enforcement of releases when either party is insolvent

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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