Skip to main content

DISCHARGE OF A CONTRACT Impossibility & Lapse of time



Discharge of a contract means termination of the contractual relations between the parties to the contract. The contract may be discharged in the following six modes: - 

1. Discharge by Impossibility of Performance

2. Discharge by Lapse of Time

3. Discharge by Performance

4. Discharge by Mutual Agreement

5. Discharge by Operation of Law

6. Discharge by Breach of Contract  



Various modes of Discharging of a Contract

Discharge of a 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. Modes of discharge of contract 

1. Discharge by Impossibility of Performance 
The effects of impossibility of the performance of a contract may be discussed under the following two heads: 

(a) Effects of Initial Impossibility - [Section 56] Initial impossibility means the impossibility existing at the time of making the contract. The effects of initial impossibility are as under void-ab-initio. 

Such promisor must compensate for any loss which such promisee sustains through the non-performance of the promise. 


Example: - A contracts to marry B, being already married to C, and being forbidden by the law to which he is subject to practice polygamy. A must make compensation to B for the loss caused to her by the non-performance of his promise.

(b) Effects of Supervening Impossibility -Section 56, Para 2, declares: “A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful”.

Cases where the doctrine of supervening impossibility applies:

A contract will be discharged on the ground of supervening impossibility in the following cases:

1. Destruction of subject-matter: When the subject-matter of a contract, subsequent to its formation, is destroyed, without the fault of the promisor or promisee, the contract is discharged. Note that it is so only when specific property or goods are destroyed which cannot be regained.


(a) A music hall was agreed to be let out for a series of concerts on certain days. The hall was destroyed by fire before the date of the first concert. The plaintiff sued the defendant for damages for the breach of contract. It was held that the contract has become void and the defendant was not liable (Taylor vs Caldwell

2. Failure of ultimate purpose: Where the ultimate purpose for which the contract was entered into fails, the contract is discharged, although there is no destruction of any property affected by the contract and the performance of the contract remains possible in literal sense. The leading case of Krell vs Henry is a good illustration on the point:

H hired a room in London from K with the object; as both parties well knew; of using the room to view the intended coronation procession of King Edward VII on a particular date.

By reason of the King’s illness the procession was postponed. H consequently could not use the room although he could go there and sit but with no purpose as there was no procession. K filed a suit for the recovery of rent.

It was held that H need not pay the rent as the contract was discharged on failure of the ultimate purpose or on postponement of the procession which was the foundation of the contract.

3. Death or Personal Incapacity of Promisor: Where the performance of a contract depends upon the personal skill or qualification or the existence of a given person, the contract is discharged on the illness or incapacity or the death of that person.


(a) A and B contract to marry each other. Before the time fixed for the marriage, A goes mad. The contract becomes void [Illustration (b) to Section 56],

4. Change of law:  A subsequent change in law may render the contract illegal and in such cases the contract is deemed discharged. The law may actually forbid the doing of some act undertaken in the contract, or it may take from the control of the promisor something in respect of which he has contracted to act or not to act in a certain way


(a) A sold to B 100 bags of wheat at Rs 700 per bag. But before delivery the Government rendered the sale and purchase of wheat by private traders illegal under the Defence of India Rules. The contract was discharged by impossibility created by subsequent change in law.

5. Outbreak of war: All contracts entered into with an alien enemy during war are illegal and void ab-initio. Contracts entered into before the outbreak of war are suspended during the war and may be revived after the war is over provided they have not already become time-barred.

It may be noted that if war is declared between the countries of the contracting parties then only the contract is suspended during war.

2. Discharge by Lapse of Time 
A contract is discharged if it is not performed or enforced within a specified period, called period of limitation. The Limitation Act, 1963 has prescribed the different periods for different contracts, e.g. period of limitation for exercising right to recover a debt is 3 years, and to recover an immovable property is 12 years. The contractual parties cannot exercise their rights after the expiry of period of limitation. 


Popular posts from this blog

INCOME TAX SECTION 32AD - Investment in new plant or machinery in notified backward areas in certain States

 Description (1) Where an assessee, sets up an undertaking or enterprise for manufacture or production of any article or thing, on or after the 1st day of April, 2015 in any backward area notified by the Central Government in this behalf, in the State of Andhra Pradesh or in the State of Bihar or in the State of Telangana or in the State of West Bengal, and acquires and installs any new asset for the purposes of the said undertaking or enterprise during the period beginning on the 1st day of April, 2015 and ending before the 1st day of April, 2020 in the said backward area, then, there shall be allowed a deduction of a sum equal to fifteen per cent of the actual cost of such new asset for the assessment year relevant to the previous year in which such new asset is installed. (2) If any new asset acquired and installed by the assessee is sold or otherwise transferred, except in connection with the amalgamation or demerger or re-organisation of business referred to in clause (xiii)or cla

60 Minute Marriage Counselling Session On Phone

Description A 60 minute phone call with an expert Marriage\Relationship Counselor to discuss your marriage\relationship related issues. Counselling aims to resolve issues and improve communication in a relationship. Couples’ counselling works with both people in the relationship, however sessions can start with one individual, working towards the involvement of the other partner. What's Included a) 60 minute phone call with the counselor where you can discuss all your issues and seek guidance. What's Not Included a) Counselling session via meeting

Send Legal Notice for Divorce

 India being a secular country derives a large part of its laws from various religious practices. One such area of law is Divorce law of India. A divorce case in India can be initiated by either party based on the procedure relevant as per the law applicable to the parties. However, the procedure for divorce always starts with sending a legal notice.   Either party can send a legal notice to the other spouse intimating his/her intent to initiate legal proceedings for divorce. Sending a legal notice acts as a formal way of communication by one party to the other acting as a warning and at the same time creating chances for a last attempt for conciliation, if possible. Connect with an expert lawyer for your legal issue   What is a legal notice for divorce? A legal notice refers to a formal communication to a person or the opposite party in a case, informing him/her about one’s intention to undertake legal proceedings against him/her. Therefore, a legal notice for divorce is a formal inti