Demand Letter: Breach of Contract (Canada)
Updated on August 22, 2026
In Canada the document you send when the other side has not performed is usually called a demand letter. Its job is to state the claim clearly enough that the other side can respond, demand a specific remedy by a specific date, preserve every right you have not yet used, and create evidence that notice was given.
There is a genuine two-system split here that most templates ignore. In the common-law provinces a demand letter is a practical step and, for most contract claims, the limitation period is two years from discovery in the provinces that have adopted the modern model. In Quebec the letter has a name and a legal function: putting the debtor in default. Article 1594 of the Civil Code allows a debtor to be put in default by an extrajudicial demand from the creditor, and being in default is what unlocks the creditor's remedies under article 1590 — including resolution of the contract and damages. This template handles both routes rather than pretending Canada has one.
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Other details
Demand Letter — Breach of Contract
- Date:
- From:
- , ,
- To:
- ,
- Notice address used:
- Delivered by:
- Contract:
- dated , reference
Dear ,
This is a demand letter concerning a breach of the contract identified above. It is sent to the notice address the contract specifies, by the method stated, by me as .
1. The Obligation and the Breach
The contract required the following: Performance was due on .
What actually happened:
Amount claimed: . Other loss and cost, so far as it can be quantified today:
2. Our Own Performance
For completeness: If you say any obligation of ours is outstanding, please identify it in writing with particulars so it can be dealt with rather than asserted generally.
3. What We Require
We require:
Under the of the contract you have the opportunity to remedy this breach, and we require it to be remedied by in accordance with that clause.
If the breach is not remedied by that date:
4. Documents
We enclose or attach the following: Please tell us promptly if you need any further document in order to respond, and provide the documents you rely on with your reply.
5. Resolving This Without Proceedings
We would prefer to resolve this without proceedings and are willing to discuss the matter or to take part in mediation. Please say in your reply whether you are willing to do so and what form you propose.
6. Reservation of Rights
Nothing in this letter, and no delay, discussion or indulgence on our part, waives or limits any right or remedy available to us under the contract or at law, including any right to end the contract, to suspend performance, to withhold payment, to claim damages, interest and costs, or to commence proceedings. All rights are expressly reserved.
7. Response
Please respond in writing by to , saying what you will do and by when. If we receive no substantive response by that date we will proceed on the basis set out above.
Yours truly,
Signed
Date:
Quebec: the mise en demeure does legal work
In Quebec the extrajudicial demand is not merely a warning shot. A debtor may be put in default by the terms of the contract itself where it provides that the mere lapse of time has that effect, by an extrajudicial demand, by a judicial application, or by operation of law. Where none of those applies, a creditor pressing for a remedy may find it has not yet triggered the debtor's default at all.
So the Quebec version of this letter states expressly that it is a mise en demeure, identifies the obligation, and gives a period for performance. It also notes a Quebec-specific point on money: article 1623 allows a stipulated penalty to be reduced where the clause is abusive or where partial performance has benefited the creditor, so a demand built on a large contractual penalty should expect that argument.
Common-law provinces: particulars, and the limitation clock
Outside Quebec the letter has no special statutory status, but it does two things that matter. It fixes the facts while they are fresh, and it starts a paper trail a court can look at on costs and on whether the parties tried to resolve matters.
Limitation periods are the trap. Most common-law provinces now use a basic two-year period running from when the claim was discovered, with an ultimate period beyond that; some provinces retain longer periods for certain claims. Correspondence does not stop the clock. If time may be short, get advice rather than continuing to write letters.
Particulars beat adjectives
A letter saying performance has been "totally unacceptable" achieves nothing. A letter saying the contract required delivery of 400 units of part 21-B by 14 July, that 260 arrived on 22 July and 41 failed inspection, is a document the other side has to answer.
This template asks for the obligation, the date due, what happened and the loss so far, and includes a short confirmation of your own performance — because the first response you will get is an allegation that you breached first.
Rights you can lose by accident
Two traps sit in every demand letter. Where a breach is serious enough to justify ending the contract, a party who keeps performing and pressing for performance may be treated as having affirmed it. If terminating is a real option, demand performance without unequivocally committing to continue.
The second is waiver by conduct: a short reservation-of-rights sentence costs nothing and closes off an argument that extra time gave something away. Delivery matters too — use the method the contract's notice clause requires, and a route that produces a record, because you may need to prove the date. In Quebec, service by a method that produces proof is particularly worth the small extra cost.
Part-by-part guide to the letter
- Heading and route
- Marks the letter as a demand letter and, for Quebec, as a mise en demeure putting the debtor in default.
- Sender and recipient
- Your details and the recipient's contract notice address, not just the person you usually email.
- Contract identification
- Contract name, date and reference so there is no doubt which agreement is in issue.
- Service statement
- How the letter was delivered, so the date of notice can be proved.
- Particulars of the breach
- The obligation, the date due, what actually happened and the loss so far.
- Your own performance
- Heads off the standard counter-allegation and asks for particulars of it.
- What you require, and by when
- The remedy sought and the deadline, under the contract's cure clause or as a reasonable period.
- Quebec default statement
- Optional. States that the letter constitutes an extrajudicial demand putting the debtor in default.
- Interest
- Optional. The contract rate where there is one, without inventing a statutory figure.
- Consequences
- What you will do if the deadline passes — accurately, and only what the contract and the law permit.
- Settlement discussion
- An offer to discuss or mediate, kept separate from the formal demand.
- Reservation of rights
- Confirms that allowing time waives nothing.
- Response required
- A named contact and a date, so silence becomes a documented choice.
Canadian points to check before sending
In Quebec, use the letter to put the debtor in default
A debtor may be put in default by an extrajudicial demand from the creditor granting sufficient time for performance, and default is what opens the creditor's remedies.
Civil Code of Québec, art. 1594Know what default unlocks
Where the debtor is in default the creditor may seek specific performance, resolution or resiliation of the contract, a reduction of its own obligation, or other remedies the law provides.
Civil Code of Québec, art. 1590Expect a penalty clause to be tested in Quebec
A stipulated penalty may be reduced where partial performance has benefited the creditor or where the clause is abusive, so a demand resting on a large penalty should be prepared for that argument.
Check the limitation period in the relevant province
Most common-law provinces apply a basic two-year period from discovery, with an ultimate period beyond it, and some retain different periods for particular claims. Quebec has its own prescription rules. Correspondence does not extend them.
Follow the contract's notice clause
A notice given otherwise than as the contract requires may be ineffective. Use the specified address and method and keep proof of delivery.
Do not invent an interest rate
Claim the contract rate if there is one. Otherwise pre-judgment interest is governed by provincial legislation and court practice, so do not state a figure you cannot support.
Avoid affirming the contract by accident
If the breach may justify ending the contract and you might want to, do not unequivocally commit to continuing performance while pressing for a remedy.
Do not imply a lawyer wrote it
Send the letter in your own name unless counsel is actually acting. A letter presented as coming from a firm when it is not is misleading and easy to expose.
How to complete this letter
- Pick the route. Choose the common-law version, or the Quebec version if the contract is governed by Quebec law or the debtor is there.
- Check the notice clause. Find the contract's notice address and method and use them.
- Set out the breach. Enter the obligation, the date it was due, what happened and the loss so far.
- Choose the deadline basis. Use the contract's cure period if there is one; otherwise set a reasonable period and say so.
- Add the enclosures. List the documents you rely on and enclose them.
- Send it with proof. Download, send by a method that produces a record, keep the receipt and diarise the deadline.
Frequently asked questions
Do I need a lawyer to send a demand letter?
No. A party can demand performance itself, and this template is written to be sent in your own name. Use a lawyer where the amounts are significant, the terms are genuinely contested, the limitation or prescription period may be close, or ending the contract is on the table. What you should not do is dress a self-written letter up as a law firm's correspondence.
What is a mise en demeure?
In Quebec it is the extrajudicial demand that puts the debtor in default. Article 1594 of the Civil Code allows default to arise from the contract itself, from an extrajudicial demand by the creditor granting sufficient time to perform, from a judicial application, or by operation of law — and default is what opens the creditor's remedies under article 1590. Outside Quebec the letter has no equivalent statutory function, though it is still the sensible first step.
How long should I give them?
If the contract sets a cure period, use it. Otherwise allow a period that is genuinely sufficient for the obligation involved — in Quebec the demand must grant sufficient time, and elsewhere a reasonable period is the practical standard. Two to four weeks suits most commercial performance; shorter where the contract is time-critical.
What is the limitation period for a contract claim?
It depends on the province. Most common-law provinces now apply a basic two-year period running from when the claim was discovered, with a longer ultimate period, while some retain different periods for particular claims, and Quebec has its own prescription rules. Correspondence does not stop the clock, so take advice if time may be short.
Can I claim interest?
Claim the contract rate if the contract has one. Beyond that, pre-judgment interest is governed by provincial legislation and court practice, so this template does not state a statutory figure. Keep principal and interest separate so the numbers reconcile later.
Our contract has a large penalty clause — can I just demand it?
You can demand it, but in Quebec expect it to be tested: a stipulated penalty may be reduced where partial performance has benefited the creditor or where the clause is abusive. In common-law provinces a clause that is a penalty rather than a genuine pre-estimate of loss can also be attacked. Frame the demand around actual loss as well as the clause.
How should I send it?
By the method the contract requires, and by a route that produces a record — registered mail, a courier with signature, or email with a retained delivery confirmation. You may later need to prove the date, and in Quebec the date of the demand can matter to when default arose.
Related templates
Disclaimer
This template and guide are general information about Canadian practice, not legal advice, and nobody has reviewed your dispute. Limitation and prescription periods, remedies and procedure differ by province and are unforgiving; if the amount matters, get advice before you send or rely on this letter.
