1. DISCHARGE OF CONTRACT
&
BREACH OF CONTRACT

2. Overview
• Discharge of contract
• Modes of discharge
• Breach of contract
• Remedies for breach of contract

3. Discharge of contract
Discharge of contract means termination of the
contractual relations between the parties to a
contract.
A contract is said to be discharged when the
rights and obligations of the parties under the
contract come to an end.

4. Modes of Discharge of contract
• By Performance
• By Mutual Agreement
• By Operation of Law
• By Lapse of Time
• By Breach

5. Discharge by Performance
• By Actual Performance:
A contract is said to be discharged by actual
performance when the parties to the contract
perform their promises in accordance with the
terms of contract
• By Attempted Performance or tender:
So far as the tender of performance is concerned, a
contract is said to discharged by attempted
performance when the promisor has made an offer
to the promisee but it has not been accepted by the
promisee.

6. By Mutual Agreement
1. Novation
2. Rescission
3. Alteration
4. Remission
5. Waiver

7. • Novation:
Novation means the substitution of a new
contract for the original contract. Such a new
contract may be either between the same
parties or between different parties. The
consideration for the new contract is the
discharge of original contract.
• Rescission:
It means cancellation of the contract by any of
the party or all the parties to a contract

8. • Alteration:
It means a change in terms of a contract with
mutual consent of the parties. It discharges the
original contract and creates a new contract and
parties of new contract should be the same.
• Remission:
It means acceptance by the promisee of lesser
fulfillment of the promise made.
• Waiver:
It means intentional relinquishment of right under
the contract. Thus it amounts to releasing a person
from legal obligation under a contract.

9. By operation of law
• By death of the promisor
• By insolvency
• By unauthorized material alteration:
If any party makes any material alteration in
terms of the contract without the approval of
the other party, the contract comes to an end
• By the identity of promisor & promisee:
When the promisor becomes the promisee, the
other parties are discharged

10. By impossibility of performance
• Effects of initial impossibility
• Effects of supervening impossibility
1. Destruction of subject matter
2. Death or personal incapacity
3. Declaration of war
4. Change of law

11. By lapse of time
A contract is discharged if it is not performed or
enforced with in a specified period called period
of limitation. The limitation act 1963 has
prescribed the different periods for different
contract.