Best examples of mutual release agreement examples (with sample clauses)

Real-world examples of mutual release agreement examples

Lawyers rarely draft a standalone mutual release. In the wild, you usually see mutual releases baked into broader settlement or termination agreements. The best examples show three things:

• What claims are being released
• What claims are not being released
• What each side is giving or doing in exchange

Below are several detailed, realistic examples of mutual release agreement examples you’ll actually recognize from practice in 2024–2025.

Example of mutual release in a business contract dispute

Imagine a software vendor and a small logistics company fighting over a failed implementation. The customer stopped paying; the vendor threatened to sue; both are tired and want to move on.

A common example of a mutual release clause in this situation looks like this (simplified but realistic):

Mutual Release. Effective as of the Effective Date, each Party, on behalf of itself and its past and present officers, directors, employees, agents, successors, and assigns, hereby irrevocably and unconditionally releases and forever discharges the other Party and its past and present officers, directors, employees, agents, successors, and assigns from any and all claims, demands, actions, causes of action, damages, or liabilities of any kind, whether known or unknown, suspected or unsuspected, in law or equity, arising out of or relating to the Master Services Agreement dated March 1, 2023 and the services provided thereunder.

In real examples of mutual release agreement examples for contract disputes, you’ll usually see:

• A specific contract named and dated
• A broad list of parties covered (officers, employees, affiliates)
• A time window (for example, “arising out of events occurring on or before the Effective Date”)

Modern trend (2024–2025): businesses are increasingly adding carve‑outs for data breach claims, privacy violations, and regulatory investigations, because those risks keep evolving and may not be fully known when the release is signed.

Employment settlement: examples include layoffs, discrimination, and bonus fights

Employment disputes generate some of the most sensitive examples of mutual release agreement examples. Think:

• A manager claims unpaid bonuses
• An employee alleges discrimination or harassment
• A company wants a clean break after a messy termination

A realistic employment mutual release might say:

Employee, on behalf of Employee and Employee’s heirs and assigns, releases Employer and its parents, subsidiaries, affiliates, and their respective officers, directors, employees, and agents from any and all claims arising out of or relating to Employee’s employment with Employer or the separation of that employment, including but not limited to claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act ("ADEA"), the Americans with Disabilities Act, and any state or local laws.

In the best examples of employment mutual releases, you’ll also see:

• ADEA-specific language and a 21‑day review + 7‑day revocation period for employees over 40 (to comply with the Older Workers Benefit Protection Act – EEOC.gov)
• A clear statement that the employee keeps the right to file a charge with the EEOC or cooperate with government investigations, even though they waive personal monetary recovery
• Carve‑outs for vested retirement benefits or COBRA rights

These details are not just “nice to have.” Courts in the U.S. will toss a release if it fails to meet statutory requirements, especially in the age‑discrimination context.

Startup founder breakup: example of a mutual release when co-founders part ways

Another very current scenario: two startup co‑founders decide to split. One is buying out the other’s equity. Both are worried about future lawsuits over IP, equity, or alleged promises.

A modern example of a mutual release in a founder separation agreement might:

• Release all claims related to the company’s formation, equity allocations, and prior agreements
• Confirm assignment of all IP created by the departing founder
• Carve out fraud and intentional misconduct so neither side can hide serious wrongdoing behind the release

Sample language:

Each Party hereby fully and forever releases the other Party and the Company from any and all claims, whether known or unknown, arising out of or relating to (a) the formation, capitalization, and ownership of the Company, (b) any services rendered by either Party to the Company through the Effective Date, and (c) any prior oral or written agreements between the Parties concerning the Company, except that nothing in this Release limits either Party’s rights with respect to (i) fraud or intentional misrepresentation, or (ii) enforcement of this Agreement.

This kind of founder scenario is one of the best examples of mutual release agreement examples where carve‑outs are non‑negotiable. Investors and future acquirers often want proof that early disputes are cleaned up, but they do not want to inherit concealed fraud.

Real estate deal gone sideways: examples of mutual release agreement examples in property disputes

Real estate generates a steady stream of disputes: failed purchases, inspection issues, repairs not completed, or earnest money fights. Many state realtor associations publish standard mutual release forms that parties sign when a residential deal collapses.

A practical example:

• Buyer discovers foundation problems after inspection
• Buyer wants out and wants earnest money back
• Seller wants to relist the property quickly

A mutual release might:

• Terminate the purchase agreement
• State how the earnest money will be distributed
• Release both parties from further obligations under the contract

Typical clause:

Buyer and Seller hereby mutually release and discharge one another, the broker(s), and any escrow agent from any and all claims arising out of or relating to the Purchase and Sale Agreement dated May 10, 2024, except for claims relating to the disbursement of the earnest money as provided in this Mutual Release.

In the real estate world, examples include:

• Releases tied to financing contingencies (loan denial)
• Releases after failed appraisals
• Releases following inspection disputes

Many state real estate commissions and realtor associations provide guidance or forms; for instance, the U.S. Consumer Financial Protection Bureau (CFPB) offers consumer‑oriented explanations on mortgage and closing processes that help buyers understand what they’re signing.

IP and licensing: examples of mutual release agreement examples for tech and content

With the explosion of SaaS, content licensing, and AI tools, IP disputes are everywhere. A content creator might claim their work was used beyond scope; a software licensor might allege under‑reporting of users.

A thoughtful example of a mutual release in an IP settlement might:

• Release past claims about infringement, underpayment, or over‑use
• Confirm a new license structure going forward (or terminate the license entirely)
• Preserve each party’s rights against third parties who infringe the IP after the settlement

Sample framing:

Except as expressly set forth in Section 4 (Ongoing License), each Party releases the other from all claims arising out of or related to the License Agreement dated January 5, 2022, including claims of copyright infringement or underpayment of royalties through the Effective Date. Nothing in this Release affects either Party’s rights against any third party that infringes its intellectual property after the Effective Date.

This is a good illustration of how the best examples of mutual release agreement examples do not blindly waive everything. They are targeted: past disputes are wiped clean, but future enforcement rights are preserved.

Personal injury and general liability: real examples from everyday disputes

Think of a slip‑and‑fall at a store, a minor car accident, or a neighbor’s dog bite. These are classic situations where insurers push for a release in exchange for a settlement payment.

In many U.S. states, insurers use standardized mutual or one‑way release forms. A realistic example:

In consideration of the payment of $8,500, the Parties mutually release and forever discharge each other and their respective insurers from any and all claims, demands, or causes of action arising out of the incident that occurred on June 15, 2024, at 123 Main Street, Springfield, including all known and unknown injuries and property damage.

Key modern twist: some jurisdictions limit how far a release can go, especially around unknown future injuries. Courts may scrutinize releases that attempt to wipe out claims for injuries that could not reasonably be known at the time of signing. The Legal Information Institute at Cornell Law School is a helpful place to look up state‑specific standards and case law on releases.

Key patterns from the best examples of mutual release agreement examples

When you compare the strongest examples of mutual release agreement examples across industries, the same patterns keep showing up.

1. Clear scope, not vague buzzwords
Good mutual releases answer:

• What relationship or contract is being released?
• What time period is covered?
• Are unknown claims included? (for example, “known or unknown, suspected or unsuspected”)

2. Thoughtful carve‑outs
Sophisticated parties rarely agree to a blanket release with no exceptions. Common carve‑outs:

• Future performance under a new or amended contract
• Fraud, intentional misconduct, or criminal acts
• Indemnity rights under insurance policies
• Regulatory or whistleblower rights (for example, SEC or EEOC cooperation)

3. Mutual vs. one‑way
Not every settlement uses a mutual release. Where both sides have potential exposure (co‑founders, business partners, buyers and sellers), mutual releases are common. In employment or personal injury, releases are often one‑way (employee or claimant releases the company/insurer) unless the employer also wants to confirm it won’t sue the employee.

4. Integration with the rest of the deal
In almost all real examples of mutual release agreement examples, the release is only one article inside a longer document that covers:

• Payment terms
• Confidentiality and non‑disparagement
• Non‑compete or non‑solicit obligations (where allowed by law)
• Return of property, IP assignments, and tax treatment

The release clause may be only a few paragraphs, but it works together with the rest of the agreement.

Drafting tips illustrated by examples of mutual release agreement examples

If you’re reviewing a template or drafting for your attorney to refine, these example‑driven tips can keep you out of trouble.

Be specific about the dispute.
Vague: “All claims between the parties are released.”
Better (inspired by the business dispute example): “All claims arising out of or relating to the Master Services Agreement dated March 1, 2023, and the services provided thereunder.”

Address unknown claims carefully.
In some states, especially for consumer or personal injury matters, courts scrutinize waivers of unknown claims. Many examples of mutual release agreement examples use language like “known or unknown, suspected or unsuspected,” but your attorney may adjust this depending on jurisdiction and the type of dispute.

List the parties covered.
Most real examples include affiliates, employees, officers, directors, successors, and assigns. If you leave them out, someone might still sue an individual employee or subsidiary.

Watch for public policy limits.
You generally cannot use a release to waive:

• Future wage and hour rights that are non‑waivable under labor law
• The right to file a government complaint (for example, with OSHA or the EEOC)
• Certain statutory rights in consumer or healthcare contexts

For up‑to‑date employment‑law guidance, the U.S. Department of Labor maintains current regulations and enforcement priorities that can affect how enforceable a release is.

Align the release with tax and payment terms.
In settlement agreements, the IRS cares what the payment is for (wages vs. emotional distress vs. physical injury). The release language should be consistent with how the payment is described in the tax section.

FAQ: examples of mutual release agreement examples and common questions

Q1. Can you give a simple example of a mutual release clause I might see in a small business dispute?
A straightforward example of a mutual release clause for a small business contract fight would say that each party releases the other from all claims “arising out of or relating to” a specific contract, up to a specific date, in exchange for a payment or other consideration. It would name the contract, cover affiliates and employees, and state that the release is mutual.

Q2. Do all settlements need mutual releases, or are one‑way releases more common?
Not all settlements use mutual releases. In employment and personal injury, one‑way releases are more common: the employee or injured party releases the company or insurer. Mutual releases are more common where both sides have meaningful exposure, like co‑founder disputes, business partnerships, or commercial contracts where both sides might have claims.

Q3. Are there examples of mutual release agreement examples that are invalid or unenforceable?
Yes. Courts have refused to enforce releases that attempt to waive non‑waivable statutory rights, releases signed under duress, and releases that fail to meet specific statutory requirements (for example, ADEA releases for workers over 40). Poorly drafted examples of mutual release agreement examples that are overly broad, misleading, or inconsistent with employment or consumer protection law are especially vulnerable.

Q4. Should a mutual release always include unknown claims?
Not always. Including unknown claims can give strong finality, but it may be inappropriate where the parties genuinely cannot assess potential future harm (for example, long‑term health impacts). Some parties limit the release to “known claims” or to a defined list of disputes. Your attorney will usually weigh the trade‑off between certainty and fairness.

Q5. Can I use an online template for a mutual release agreement?
Templates and the best examples of mutual release agreement examples are helpful starting points, but they are not a substitute for legal advice. Laws differ by state and country, and small wording changes can have big consequences. Use examples to understand structure and language, then have a licensed attorney adapt them to your specific facts and jurisdiction.

Bottom line: mutual releases are everywhere—from startup breakups to fender‑benders—but the details separate a clean break from a future lawsuit. Use these real‑world examples of mutual release agreement examples as a reference point, not as ready‑to‑sign documents, and always run final language past a qualified lawyer in your jurisdiction.