Auto-Renewal Clause
The clause that renews a contract you meant to leave, because the window to say no closed months ago.
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What An Auto-Renewal Clause Does
An auto-renewal clause — sometimes an "evergreen" clause — extends the contract for a further term unless one side gives notice inside a defined window before the end of the current one. Nothing has to happen for the renewal to take effect. Not renewing is the action that requires effort.
The renewal term is rarely the problem. The notice window is: ninety days before the end of an annual term means the decision has to be made nine months into a relationship you may only be starting to evaluate. Miss it by a day and the next term is owed in full.
The second half worth reading is what happens to the price. A renewal clause silent on pricing renews you at whatever list price applies, and one that permits an increase "on notice" often means notice given after the cancellation window has already closed.
In plain language
“Unless I remember to cancel during a specific window months before it ends, this contract continues for another full term — probably at a new price.”
The Clause, As It Usually Arrives
Nothing below is unusual drafting. That is what makes it worth reading twice.
The wording
This Agreement shall renew automatically for successive twelve (12) month terms unless either party provides written notice of non-renewal at least ninety (90) days prior to the end of the then-current term. Fees for any renewal term shall be at the Supplier's then-current list price.
What it means once it is in force
The cancellation decision has to be made in month nine of twelve, before the year can be judged, and the price for the year you are committing to is not knowable when the window closes. The two halves work together: by the time you learn the new price, you can no longer decline it.
General information about a common drafting pattern, not legal advice about your document.
What Can Go Wrong
- A full further term committed to by inaction, with no meeting, no signature and no reminder.
- A price set after the point at which you could have left.
- Notice windows that differ between the master agreement and an order form, so the date you are watching is the wrong one.
- Renewal terms as long as the original — a one-year trial that becomes a three-year commitment.
- Notice requirements that are hard to satisfy on purpose: registered post, a named officer, a specific address, "written notice" excluding email.
Wordings Worth Stopping At
Search your own document for these before you read anything else in the clause.
"at least ninety (90) days prior"
Any window longer than thirty days on an annual term is worth questioning. It exists to be missed.
"then-current list price"
You are agreeing to a price that does not exist yet, and you lose the right to refuse it before it is published.
"successive terms of equal length"
Check what "equal" refers to. On a three-year initial term this renews you for another three.
"written notice" with a postal address and no email
A delivery method nobody uses any more is a way of making a right theoretical.
no obligation on the supplier to remind you
A renewal notification requirement is cheap to agree to and the single most effective fix. Its absence is a choice.
Who It Protects
What Is Normally Negotiable
How LegalValidate Reads an Auto-Renewal Clause
The review reads the whole document and reports six scores out of ten, each with the reasoning behind it. Here is where this clause shows up in that.
- The analysis reports on the whole document, and a long notice window paired with an open renewal price shows up in Balance of Terms and Overall Risk Exposure with the reason stated in plain language.
- Renewal terms are often split across the agreement and an order form. The review reads whatever you upload — if the order form is a separate file, upload both, or merge them first with the free merge tool.
- The reasoning names the dates it found, which is the useful part: the renewal window is a diary entry, and nobody makes it while reading the contract.
- It reports what the document says. It cannot know what your supplier will agree to change — though in this clause, more than most, they usually will.
Check the auto-renewal clause in your own contract
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Analysis Results
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Documents Where This Clause Matters Most
Each of these pages says what the review checks in that kind of agreement.
Auto-Renewal Clause — Questions
Are auto-renewal clauses legal? +
Generally yes in business-to-business contracts. Several jurisdictions restrict them in consumer contracts, requiring clear disclosure or a reminder before renewal. In commercial agreements they are enforceable, which is why the notice window has to be read rather than assumed.
What happens if I miss the notice window? +
The contract renews for the next term and the fees for it become payable. Suppliers will sometimes agree to release you as a commercial gesture, particularly if you ask immediately, but you are asking rather than exercising a right.
What is a reasonable notice period? +
Thirty days ahead of an annual term is common and workable. Sixty is defensible for services that take time to replace. Ninety on a twelve-month term means deciding before you have enough information.
How do I find the renewal terms in my contract? +
Upload it here — the free review reads the term, the renewal and the notice window together, and reports what it found. No account needed.
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