Discharge of contract - Discharge of Contract, Business Law Video Lecture | Business Law - B Com

let's see now this is the main point
let's talk about performance of contract
how does a contract get performed and
you know once the contract is performed
that's the end of the contract the
contract was formed this gave birth to a
right and liability to the both parties
then the both parties perform the
contract now what now there's nothing
left to be done in the contract the
contract gets discharged here the game
is over here once the performance is
done once the contract is performed it
brings an end to the contract because
performance was the ultimate motive of
the contract the contract was made so
that the other party performs it a
contracted that B so that B gives him
money be contracted with a so that he
gets the bike from him so he wanted a to
perform and a wanted me to perform and
this gave rise to formation of contract
and after formation if both the parties
perform the contract is over it brings
an end the contract gets terminated the
contract gets discharged because the
liability in the contract which the
parties had gets discharged now so the
contract is said to be discharged so now
let's see how does a contract get
discharged first by actual performance
we have already discussed this when you
perform the contract the performance is
over and the Contra
it's discharged second by mutual
agreement when both the parties decide
to reduce the performance or to waive of
the performance altogether then the
performance is discharged and once the
performance is discharged the contract
gets discharged the contract also gets
discharged by impossibility of
performance if some impossibility arises
in the contract if some impossibility
crops up in the contract
next is lapse of time lapse of time
means when the time to perform expires
you know if a contract was supposed to
be performed within a particular or a
stipulated time and if that time has
elapsed if that time has gone by if that
time has expired in that case the
contract gets discharged now the
aggrieved party can claim compensation
from the other party for not performing
it so if the time is over the time is
elapsed the contract also gets
discharged the next is operation of law
the contract lapses by operation of law
now what do you mean by operation of law
operation of law means where the law
operates where the law comes into
picture now what are the times what are
the examples that you think the law
would come into force the law would come
into picture I'll give you an example
let's say there are two parties who work
in a contract and one of the party one
of the party is done oh if either of
them
get insolvent one of the parties become
insolvent or one of the parties go mad
now what happens in such cases is the
law gets the contract gets discharged by
operation of law here the law comes into
force and the contract gets discharged
next is breach of contract breach of
contract means cancellation of the
contract by non-performance one of the
parties do not perform the contract they
break the contract they had promised to
perform the contract and now they are
breaking their promise such a breaking
of promise to perform is called as
breach of performance or breach of
contract because they have breached they
have broken they have gone beyond the
limits set by the contract they had to
be within the four walls of the contract
now they have breached it the contract
the contract told them to perform it
they have gone outside the contract they
have breached the contract this is
called as breach when you do not perform
the contract when you do not fulfill the
promise that you had made you are said
to have breached the contract so when
the contract is breached
it gets discharged however in case of
breach the aggrieved party gets some
rights and remedies which we will
discuss in the next unit and finalists
Accord and satisfaction
according satisfaction is when the
promisee accepts a smaller performance
from the promises
let's say the promise of was supposed to
give problem Z 20,000 rupees but the
promisee accepts and agrees for a
payment of fifteen thousand only for
twelve thousand only so now he is okay
he is satisfied
he gives us Accord to a smaller firm
this is called as discharged by accord
and satisfaction so now we have
discussed these points where in the
contract gets discharged so contract
gets you discharged by performance we
have already done actual performance and
tender of performance contracts
discharged by mutual agreement we
discussed this in detail in the next
slide impossibility of performance we'll
discuss that after mutual agreement
lapse of time operation of flow these
will be taken up after impossibility of
so we are going to take these topics in
detail and study and then finally we do
breach of contract in the next unit okay
there's one more point promises neglect
now what do you mean by promisee is
negated
promises niglet means where the promisee
is negligent about his duty to allow the
performance from the other side now
let's say P and Q enter into a contract
P tales cube that I want my house to be
constructed and I want you to construct
it so Q says okay I will construct your
house so you will construct a house for
P and P in return will give Q let's say
five lakh rupees
we paid five lakh rupees but there was
one condition to the contract that
whatever the material that P would
require rather the Q would require will
be supplied by P P will supply him all
the material that he would require to
construct he was constructing so Q says
to P that you have to give me all the
materials that I require to construct
the house now P is negligent about his
duty and he does not facilitate Q the
material that he wants to construct the
house now because of promises neglect
promises cannot perform the contract and
thus promises is discharged of his
duties of his liabilities of his
performance under the contractor and
this brings an end to the contract
between the two because it was very
important for the contract that this
condition is followed that P should
supply the material to Q but this
condition was not followed by P he was
negligent in fulfilling his duties under
the contract this will render the
contract discharged okay
now let's study in detail as to what are
the things or what are the elements that
are considered under mutual agreement
and what are the provisions of law
regarding those elements in mutual
agreement let's see