DISCHARGE OF CONTRACT

A contract may be discharge by: Agreement A subsequent impossibility or frustration Breach Performance

Discharge by Agreement Since the parties to a contract enter into their relationship by agreement, it follows that they may also by agreement release each other from their obligation. The mutual release of each party from his obligations under the agreement provides the consideration for the agreement to discharge the contract.

A agrees to dig B’s garden for 10p. A digs the garden as promised The parties may agree to rescind the former contract and to substitute one where B agrees to provide A with a bicycle instead of the 10p If A accepts there will be a new agreement with a new consideration.

Discharge by Performance A contract may be discharge by performance, each party fulfilling completely his obligations under the contract so that nothing remains to be done Where, however, one party has done all that is required and the other has not, the contract is not discharge, for only one party has fulfilled his obligation.

Discharge by Breach The breach of contract entitles the injured party to an action in damages. But it may also entitle him to treat the contract as discharged, provided that the injured party is able to show that the breach is of the whole contract or ‘goes to the root of’ the contract

Hochster v De La Tour In April 1855, D agreed to engage H as a courier for European tour to commence on 1 June. On 11 May, D informed H that he no longer required his services. H began legal action. Held: That D had broken his contract by repudiation, and H could bring an action at once.

Discharge by Frustration Where there is destruction of specific thing necessary for the performance of the contract Where the contract depends on the happening of certain event Where there is death or personal incapacity Where there is a change in law

That the contract was discharge. Taylor v Caldwell Where there is destruction of specific thing necessary for the performance of the contract C let a music-hal to T for a series of concerts on certain days, The hall was accidently burnt down before the concert opened. Held: That the contract was discharge.

Where the contract depends on the happening of certain event Krell v Henry Defendant agreed to hire plaintiff’s flat to watch the coronation procession of Edward VII. The King was taken ill and the procession was cancelled, That the contract was discharged and the rent was payable by defendant.

Where there is death or personal incapacity CONDOR V THE BARRON KNIGHTS. LTD C, aged 16, was drummer employed by the Barion Knights band under a contract for 5 years. His duties were to pay on 7 nights a week when the band had engagement. C fell ill and his doctor ordered that he was fit to play only on 4 nights a week. The band terminated his contract. Held: That, being ill it was impossible for C to continue the contract in a business sense and the contract was properly terminated Where there is death or personal incapacity

Where there is a change in law or in the circumstances