Withdrawal from a contract is one of the ways to terminate a contract. It can occur if the contract becomes particularly disadvantageous for one party, or if the parties agree on it in the contract itself. Withdrawal from a contract in the case of a consumer is a special legal concept.
What exactly is withdrawal from a contract?
Termination of a contract is regulated by the Civil Code. It is a method of terminating an obligation other than the standard discharge agreed between the parties. Standard discharge of an obligation occurs through the performance of duties by each party. Withdrawal from a contract can occur on the basis of the law or if the parties agree on this option in the contract itself.
Statutory withdrawal from a contract
Material breach of contract
The Civil Code lays down that if a contracting party breaches a contract in a material way, the other party may withdraw from the contract. A breach of contract is also material if the breaching party knew, or must have known, that the other party would not have entered into the contract had it foreseen the breach. Any other breach of contract is not a material breach.
Let us demonstrate this with an example. You buy an old car from someone. They claim that the car is 5 years old, has done 100,000 km, has never been in an accident, and that the seller is the first owner. At the same time, they state that the battery was replaced last year and the car comes with both summer and winter tyres, which are also only a year old. All this information is also stated in the contract. You buy the car, then take it for a vehicle inspection before transfer, and find out that the car was in an accident, the odometer has been clocked, and the winter tyres are unusable. If you had known about these facts, there is a very reasonable assumption that you would not have bought the car. This constitutes a material breach of contract by the seller, and you are entitled to withdraw from the contract.
Suspicion that a material breach will occur
By law, it is also possible to withdraw from a contract if it is clear to a contracting party that the other contracting party will breach its obligations in a material way, and fails to provide reasonable security after being requested to do so. What does this mean? Let us look at the car example again.
Let us say you are selling your old car, you have taken good care of it the whole time, and you want a fair price for it. It is not a new car, but it is in very good condition, so you are selling it for a price only 100,000 CZK (about 4,600 USD) lower than a new car would cost. A potential buyer meets with you, saying they will give you cash and then you will sign the purchase agreement. However, the buyer starts claiming that they do not currently have the money, will have it next week, and will pay you then, but would like to take the car today, since you have the contract, so why not. You are not sure whether they will have the money next week, and you do not like it. You therefore ask them for at least 50% of the purchase price immediately, but the buyer makes excuses and refuses to give you the money, saying they do not currently have cash on them and will bring it to you next week anyway. There is a reasonable concern that the buyer will not fulfil their promise, so you decide to withdraw from the contract immediately and will not hand over the car to them.
By withdrawing from the contract, the obligation arising from the contract is cancelled from the beginning, meaning that neither party has any further duty to perform what was promised.
Default in performance of the contract
It is also possible by law to withdraw from a contract in the event of default in performance. If this default constitutes a material breach of contract, the other party may also withdraw from the contract.
This applies, for example, to a case where you decide to renovate a flat and enter into a contract for work with a construction company. However, the company works on the floors for 2 weeks instead of 2 days, delaying the overall subsequent renovation. You therefore decide to withdraw from the contract and find a new company. This constitutes a material breach of contract.
Defective performance
Contracts are to be performed properly, which also means that performance must be free of defects. If a defect represents a material breach of contract, you have the right to choose between:
- rectification of the defect
- delivery of a new item
- repair of the item already delivered
- a discount on the purchase price
- withdrawal from the contract
An example would be: you order a smart fridge that is supposed to connect to an app, but this connection is missing on the delivered unit.
Withdrawal from consumer contracts
Who is a consumer? A consumer is any person who, as a private individual outside their business or trade, enters into a contract with a trader. Simply put, a person who buys something for themselves, for example, from a company’s e-shop.
In certain cases, you are entitled to withdraw from a contract within 14 days. These are cases where:
- you enter into a contract as a consumer at a distance (e.g. over the internet)
- you enter into a contract away from business premises (e.g. at your home)
- you enter into a consumer credit agreement
As a consumer, you do not need to give a reason if you wish to withdraw from a contract. To meet the 14-day deadline, it is sufficient to send the seller a notice of withdrawal from the contract within this time limit.
Many sellers also provide their own withdrawal forms. A sample form for inspection can be found here.
When withdrawal from a consumer contract cannot be used
The law sets out exceptions where it is not possible to withdraw from a contract. For example, this is not possible if the goods were custom-made specifically for you.
Another exception is perishable goods (foodstuffs, live flowers, etc.).
Withdrawal is not possible if the delivered goods have been mixed with other goods. For example, paints, if you buy white paint and mix it at home with yellow paint you already had.
Another example is goods where returning them would be unhygienic (e.g. a toothbrush, contact lenses). However, this must involve a hygienically sealed package that protects the goods.
If you buy a music CD, for example, you can only withdraw from the contract until you remove the item from its original packaging.
It is also not possible to withdraw from a contract if you buy periodicals, newspapers or magazines. This does not apply to subscriptions, in which case withdrawal from the contract is possible.
The final examples where withdrawal from a contract is not possible are a contract for a public auction under a special act, and the purchase of goods whose price depends on financial market fluctuations beyond the control of the trader.
Legislation used – Civil Code Sections 1818, 1824, 1829, 1837
USD amounts are approximate, converted at the Czech National Bank rate of 21.83 CZK per USD on 27 October 2026.