Documente Academic
Documente Profesional
Documente Cultură
DISCHARGE BY PERFORMANCE
DISCHARGE BY AGREEMENT OR CONSENT
DISCHARGE BY IMPOSSIBILITY OF
PERFORMANCE
DISCHARGE BY LAPSE OF TIME
DISCHARGE BY OPERATION OF LAW
DISHARGE BY BREACH OF CONTRACT
Discharge of Contract
A contract is said to be discharged when it ceases to operate.
The rights and obligations created by it comes to an end.
A contract may be discharged -
By Performance
Actual performance – doing what the parties intended to do
when they entered in to the contract.
Attempted performance or tender – It is the legitimate
attempt on the part of the promisor to perform his obligations
2
Performance of Contract
Performance of a contract is a mode of discharge of the
contract.
Performance of contract takes place when the parties to the
contract fulfill their respective obligations under the
contract.
The parties to a contract must either perform or offer to
perform their respective promises,
unless such performance is dispensed with or excused under
the provisions of this Act, or of any other law.[Sec 37]
3
Types of Performance
Complete
Performance
Substantial
Performance
Inferior Performance
Complete Performance
• Most contracts are discharged by strict
performance.
• A fully performed contract is an executed
contract.
• Tender of performance discharges contractual
obligations.
Substantial Performance
• This occurs when there is a minor breach of
contract.
– Performance deviates slightly from complete
performance.
– Non breaching party may recover damages.
Inferior Performance
• This is a material breach of contractual
obligations.
• Non breaching party may rescind contract and
seek restitution.
• Non breaching party is excused from any
further performance.
Performance and Demand of Performance
By promisor himself. (S. 40)
Promisor’s Agent. (S. 40)
Legal representatives.
Third person. (S 41)
Joint promisors.
Promisee
Legal Representative
Third Party
Joint promisee
8
DISCHARGE BY
AGREEMENT OR CONSENT
NOVATION (Sec 62): New contract substituted for old contract with the same or
different parties
RESCISSION (Sec 62) : When some or all terms of a contract are cancelled
10
By operation of Law
By death.
By merger.
By insolvency.
11
By Impossibility of Performance
Impossibility existing at the time of agreement –
12
By Supervening Impossibility
13
By breach of contract
Actual Breach
a) On the due date of performance.
b) During the course of performance of contract.
i) Express Repudiation.
ii) Implied Repudiation.
Anticipatory Breach
a) By express renunciation.
b) Making the performance of promise become
impossible by doing some act.
14
Remedies for Breach of Contract
When the contract is broken, the injured party has one or
more of the following remedies:
Rescission of the contract.
15
Suit for damages
16
Types of Monetary Damages
Compensatory Consequential
Damages Damages
Nominal Liquidated
Damages Damages
Compensatory Damages
• Award of money intended to compensate a non-
breaching party for the loss of the bargain.
• They place the non-breaching party in the same
position as if the contract had been fully
performed by restoring the “benefit of the bargain.”
• The amount of that will be awarded for breach
of contract depends on:
– The type of contract involved, and
– Which party breached the contract.
• Special types of contracts:
– Sale of Goods
– Construction Contracts
– Employment contracts
Mitigation of Damages
27