MB0051 Legal Aspects Of Business
IDEA INSTITUTE OF MANAGEMENT AND TECHNOLOGY
Name Jeenal Bhatt
Studying in MBA 3rd Semester
Subject Legal Aspects of Business
Study center Idea Institute
Subject Code MB0051
Date of Submission Master of Business Administration- MBA Semester 3
MB0051-Legal Aspects of Business
Assignment Set- 3 (60 Marks)
Q.1. “Discharge refers to the termination of contractual relationship between the parties”. Explain the statement along with different modes of discharging a contract.
Answer:
Discharge refers to the termination of contractual relationship between the parties. The contract ceases to operate, i.e., when the rights and obligations under the contract ends. According to Sections 73-75 of the Contracts Act, a contract may be discharged in several modes.
Performance or tender
The obvious mode of discharge of a contract is by performance, where the parties have done whatever was contemplated under the contract. Thus, where A contracts to sell his/her car to B for Rs. 185000, as soon as the car is delivered to B and B pays the agreed price for it, the contract comes to an end by performance. The tender or offer of performance has the same effect as performance. If a promisor tenders performance of his/her promise but the other party refuses to accept it, the promisor stands discharged of his/her obligations.
Mutual consent
Section 62 of the Act states that if the parties to a contract agree to substitute a new contract for the old or rescind or alter the terms, the original contract is discharged. A contract may be terminated by mutual consent in any of the six ways, viz., novation, rescission, alteration and remission, waiver and merger.
Impossibility of performance
A contract may be discharged because of impossibility of performance. There are two types of impossibility:
One that is inherent in the transaction
One that may emerge later by the charge of certain circumstances material to the contract.
Operation of law
Discharge by operation of law
Name Jeenal Bhatt
Studying in MBA 3rd Semester
Subject Legal Aspects of Business
Study center Idea Institute
Subject Code MB0051
Date of Submission Master of Business Administration- MBA Semester 3
MB0051-Legal Aspects of Business
Assignment Set- 3 (60 Marks)
Q.1. “Discharge refers to the termination of contractual relationship between the parties”. Explain the statement along with different modes of discharging a contract.
Answer:
Discharge refers to the termination of contractual relationship between the parties. The contract ceases to operate, i.e., when the rights and obligations under the contract ends. According to Sections 73-75 of the Contracts Act, a contract may be discharged in several modes.
Performance or tender
The obvious mode of discharge of a contract is by performance, where the parties have done whatever was contemplated under the contract. Thus, where A contracts to sell his/her car to B for Rs. 185000, as soon as the car is delivered to B and B pays the agreed price for it, the contract comes to an end by performance. The tender or offer of performance has the same effect as performance. If a promisor tenders performance of his/her promise but the other party refuses to accept it, the promisor stands discharged of his/her obligations.
Mutual consent
Section 62 of the Act states that if the parties to a contract agree to substitute a new contract for the old or rescind or alter the terms, the original contract is discharged. A contract may be terminated by mutual consent in any of the six ways, viz., novation, rescission, alteration and remission, waiver and merger.
Impossibility of performance
A contract may be discharged because of impossibility of performance. There are two types of impossibility:
One that is inherent in the transaction
One that may emerge later by the charge of certain circumstances material to the contract.
Operation of law
Discharge by operation of law