A contract is a legally binding agreement between two or more parties. It is a promise to do, or not do, something in exchange for something else of value. A contract can be discharged, or terminated, in several different ways.
One way a contract can be discharged is by mutual agreement. This means that all parties involved in the contract come to a mutual understanding that the contract should be terminated. This can be done through a process called novation, where a new contract is created to replace the old one, or through rescission, where the parties agree to return to their original positions before the contract was formed.
Another way a contract can be discharged is through performance. When both parties fulfill their obligations under the contract, the contract is said to be discharged by performance. This means that the contract has been completed and is no longer in effect.
A contract can also be discharged by breach. This occurs when one party fails to fulfill their obligations under the contract. The other party may then choose to terminate the contract and seek damages for the breach.
Another way a contract can be discharged is through frustration. This occurs when an event occurs that makes it impossible for the contract to be performed. This could be due to circumstances beyond the control of either party, such as a natural disaster or the sudden death of a key participant.
Finally, a contract can be discharged by operation of law. This means that the contract is terminated due to a change in the law or the expiration of a certain time period.
In summary, a contract can be discharged through mutual agreement, performance, breach, frustration, or operation of law. It is important for parties to understand the terms of their contract and the ways in which it can be discharged in order to avoid any misunderstandings or disputes.
Discharge of a contract
Therefore, what is required, inevitably, is mutuality. Thus, the doctrine regards that every contract is impliedly conditional upon possibility. Juggilal Kamlapat v N. The previous contract with the lecturer has been terminated through the merger. Discharge by Impossibility of Performance If it is impossible for any of the parties entered in the contract to perform their obligations, then the impossibility of performance of contract leads to discharge of contract. Waiver means the deliberate abandonment or giving up of a right of the party which is entitled to under a contract, whereupon the other party to the contract is released from his obligation.
Various Modes Of Discharge Of Contract
If the impossibility of performing the contract exists from the start, then it is termed as impossibility by ab-initio. The creation of an agreement requires the common consent of at least two people, one of them usually making a proposition and another accepting the contract. Today in this article, we have shared what is the discharge of contract and its types, and modes of discharge of contract. I chose Law as my career because I was inspired by the likes of Lawyers like Nani Palkhivala and Ram Jethmalani. For example, an agreement to discover a treasure by magic, being impossible to perform, is void. If the seller was unable to deliver goods at the given time then it is called the actual breach of contract.
Modes Of Discharge Of Contract
Since both the parties to the contract fulfill their obligation arising under the contract, then it is discharged by performance. The aggrieved party has a right of election; that is to say, it can choose either to affirm the contract or to terminate it. However, the court rejects his complaint because he has crossed the time-limit of three years to recover his debts. A enters into an agreement with B, and gives B a mortgage of his estate for 5000 rupees in place of the debt of 10,000 rupees. A pays Rs 2,000 to B and B accepts the amount in satisfaction of the whole debt. Discharge of contract also ceases the legally binding power of the contract.
