In a case of first impression (LJL Transportation, Inc. v. Pilot Air Freight Corp., 962 A.2d 639 (Pa. 2009)), the Pennsylvania Supreme Court ruled that, in some circumstances, a party’s breach of a contract may justify the immediate termination of that contract, even in the face of an express “right to cure” clause. Citing decisions under other states’ laws, the Pennsylvania Supreme Court held: “[W]hen there is a breach of contract going directly to the essence of the contract, which is so exceedingly grave as to irreparably damage the trust between the contracting parties, the non-breaching party may terminate the contract without notice, absent explicit contractual provisions to the contrary.”

Significantly, the court’s holding is not limited to franchise agreements. In fact, Appellate Group partner Donna Doblick recently featured the superior court’s decision in LJL Transportation in a post-trial motion that led to a very favorable settlement of a breach of contract case between a minority-owned business and an independent contractor.