However, Peter meets with an accident and becomes insane. The non-existence or non-occurrence of a particular state of things which was considered a given for the performance of the contractĮxample: Peter enters into a contract with John to marry his sister Olivia within one year.Destruction of the subject- matter essential to the performance.However, the impossibility might also arise later due to: If the impossibility exists from the start, then it is impossibility ab-initio. If it is impossible for any of the parties to the contract to perform their obligations, then the impossibility of performance leads to a discharge of the contract. John agrees and they make a contract to that effect. This discharges the original contract due to mutual consent.ģ] Discharge by the Impossibility of Performance Subsequently, he loses his job and requests John to accept Rs 75,000 as a final settlement of the loan. If all parties to a contract mutually agree to replace the contract with a new one or annul or remit or alter it, then it leads to a discharge of the original contract due to a mutual agreement.Įxample: Peter owes Rs 100,000 to John and agrees to repay it within one year. In such cases, it is called attempted performance or tender. On the other hand, it is possible that when the promisor attempts to perform his promise, the promisee refuses to accept it. Now, discharge by the performance of a contract can be by:Īs shown in the example above, actual performance is when all the parties to a contract do what they had agreed for under the contract. Since both the parties to the contract fulfil their obligation arising under the contract, then it is discharged by performance. As soon as it is delivered, John pays the promised amount.

When the parties to a contract fulfil the obligations arising under the contract within the time and manner prescribed, then the contract is discharged by performance.Įxample: Peter agrees to sell his cycle to John for an amount of Rs 10,000 to be paid by John on the delivery of the cycle.

10 Solved Question on Discharge of a Contract 1] Discharge by Performance

Discharge and breach meaning