Modes of Discharge of contract under Indian Contract Act 1872

In this article we are providing you Modes of Discharge of contract under Indian Contract Act 1872 which will help you to understand the various mode of Discharge of contract

Introduction

When parties to contract come into a contract they made obligations on each other. when the obligations on parties come to an end discharge of the contract happens. In this article, we are going to explain various ways of discharge of the contract.

Modes of Discharge of contract

1] Discharge by Performance
2] Discharge by Mutual Agreement
3] Discharge by the Impossibility of Performance
4] Discharge of Contract by Lapse of Time
5] Discharge of Contract by Operation of Law
6] Discharge by Breach of Contract
7] Discharge of Contract by Remission
8] Discharge by Non-Provisioning of Facilities
9] Discharge of Contract due to the Merger of Rights

1) Discharge by Performance

Discharged of the contract by performance happens when the parties of the contract fulfill the obligations which are mentioned in the contract within the stipulated time.

Illustration- Suraj agrees to sell his mobile to Gopal on the condition that Gopal will give a bicycle to Suraj. As soon as Gopal gave his bicycle to Suraj. Suraj gave his mobile to Gopal.

The above illustration is the best example of the discharge of the contract by performance. As it is showing that at the time both parties fulfill their obligations within the stipulated time the discharge of the contract by performance is happens.

Discharge by the performance of a contract can occur by –

1) Actual performance

2) Attempted performance

2] Discharge by Mutual Agreement

In this all parties to contract agree mutually to replace the contract with a new.

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.

3] Discharge by the Impossibility of Performance

Initial Impossibility – an agreement which is impossible to do is void-ab-initia.

Subsequent Impossibility – Due to some unavoidable circumstances, a contract becomes impossible or unlawful and these types of contract cannot be binding.

4] Discharge of a Contract by Lapse of Time

The limitation Act 1962 prescribed the specific period for the performance of the contract. contract must be performed within the period of limitation but if the contract is not performed in time. it may affect the other party and cancelled the contract.

5] Discharge of a Contract by Operation of Law

Contract can be discharged by the operation of law.

6] Discharge by Breach of Contract

In this type of discharge one party fail to perform the contract and it affects the other party. Actual Breach and Anticipatory Breach are two kinds of discharge by breach of contract,

Rights and Duties of Bailor and Bailee

Who Performs the Contract?

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