I said to him, I was pretty sure I don't have to pay any fee as they are in breach of contract and he came back with, we are not in breach of contract because we have let you know what is happening, and if you don't accept it then it is up to you and you have to pay a termination fee to cancel.

I am pretty sure that isn't correct, as what would be the point of 11.2, you can pay a termination fee whenever you want, but could do with a little more information to go back at them with.