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Discharge of the contract
The document discusses various ways in which a contract can be discharged or terminated, including: 1. By performance or tender of performance by both parties. 2. By mutual consent or agreement between the parties, such as novation, rescission, alteration, remission, waiver, or merger. 3. By impossibility of performance, either inherent at the time of contract formation or supervening later, such as destruction of the subject matter. 4. By operation of law, such as death of a party, insolvency, lapse of time beyond the statute of limitations, or material alteration of the contract terms. 5. By breach of contract if a party fails to
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Discharge of the contract
- 2. The casesin which a contract is discharged may be classified as follows: A. By performance or tender. B. By mutual consent. C. By impossibility of performance. D. By operation of law. E. By lapse of time F. By breach of Contract
- 3. When thecontract is performed by both the parties and there notthing remains to do, then it is called discharge by performance Performance of contract is very common way of discharge. It may be Actual Performance When both the parties perform their promises. Attempted Performance or tender Only an offer to perform the obligation under the contract.
- 4. The terminationof contract by further agreement or consent. Ways to do so: 1.Novation 2.Rescission 3. Alteration 4. Remission 5. Waiver 6. Merger
- 5. ◦ When anew contract is substituted for an existing one between the same parties ◦ When a new contract is substituted for an existing one between one of the parties and a third party. ◦ Novation should take place before the expiry of the time of the performance of the contract.
- 6. ◦ Takes placewhen all or some of the terms of the contract are cancelled. ◦ Could be done by a)mutual consent or b) when one party fails in the performance of contract, the other party could rescind the contract without fear of claim of compensation.
- 7. Modification ofone or more terms of the contract by the mutual consent of the parties. Discharge by mutual consent or agreement Remission Remission means acceptance of lesser sum than what is contracted or lesser fulfilment of the promise.
- 8. When parties tothe contract agree that they shall no longer be bound to the contract
- 9. The party rescindinga voidable contract shall, restore the benefit ,so far as may be ,to the part if he has received under the contract from him. Merger Merger of two or more rights into one contract . When an existing inferior right of party merges into a newly acquired superior right by the same party , it is a merger of rights.
- 10. (a) Inherent impossibility Knownto the parties Unknown to the parties (b) Subsequent impossibility A contracr is discharged by superventing impossiblity in the following cases. 1. When the subject matter of the contract is destroyed 2. death or incapacity of the parties 3. change of law 4. outbreak of war.
- 11. 1. By death 2.By insolvency 3. By merger 4. Rights and liablities becoming vested in the same person. 5. material alteration 6. loss of evidence of contract
- 12. According tolaw of limitation Act 1963, a contract should be performed with in a specified period That period is called period of limitation If it is not performed and no action is taken by the promiseee with in the period of limitation ,he can not take legal action in the court . In other words , we can say that the contract is terminated.
- 13. Where thepromisor neither performs his contract nor tender his performances or where the performances is defective , ther eis a breach of contract. It occurs when a party to the contract does bnot fulfil his contractual obligation or makes it impossible. Breach of contract may be Actual Breach of Contract Anticipatory Breach of Contract