6

The Indian Contract Act, 1872: Performance of Contract

Performance of a contract is one of the methods of discharge of a contract. The performance may be of two types: (a) actual performance and (b) attempted performance.

An actual performance of a contract means performing all the promises and fulfilling all the liabilities by all the parties. The actual performance discharges the contract and also discharges the parties. It is known as the natural method of discharge of the contract.

An attempted performance means the promisor has made an offer to perform a promise to the promisee but it has not been accepted. The attempted performance is known as tenders. If there is a valid tender, it discharges the party who is not at fault. Let us understand in detail, when a tender is said to be a valid tender.

6.1 ESSENTIALS OF A VALID TENDER

An attempt to perform a promise by a promisor is regarded as a valid tender, when it fulfills all of the following conditions.

6.1.1 It Must Be Unconditional

An unconditional means without condition. It means the promisor shall perform the promise as per the terms of contract as decided between the parties of contract. If the promise is not performed as per the condition, it is known as the conditional tender.

Example

A owes B ₹ 5000 and has fallen due. A offers to pay in five installment and tenders the first installment. This is a conditional tender.

6.1.2 It Must Be at Proper Place

The tender must be made at a proper place as specified in the contract. If no place is specified in the contract, the tender must be made at a place fixed by the promisee. Once a valid tender of goods is made at the specified or fixed place, the promisor is under no further responsibility of the performance even if the tender is not accepted.

Example

A contracts to deliver cotton to B at his warehouse. A must bring the cotton to B’s warehouse only and tender the performance.

6.1.3 For Whole Obligation

It must be for the whole obligation and not in part. However, a minor deviation from the terms do not make a tender invalid.

Example

A agreed with B to sell 10,000 kg of rice but A delivered 22 kg less than that. Held, the buyer could not refuse to take delivery because the deficiency is negligible.

6.1.4 In Legal Tender Money

In case of a tender of money, the tender must be in legal tender money. Legal tender money means current currency notes or coins. The tender of money in the form of foreign currency is not a valid tender, unless it is agreed between the parties. A payment by a cheque is the valid tender, if the person to whom it is made is ready and willing to accept it.

6.1.5 It Must Be Made at Proper Time and to a Proper Person

The tender must be at a proper time i.e. at a stipulated time or during business hours. The tender of performance must be made to a proper person. The promisee or his authorized agent is considered as a proper person.

6.1.6 Reasonable Opportunity to Promisee

The tender must give a reasonable opportunity to the promisee to verify or examine the goods. The promisee has a right to examine, verify and check the goods or money tendered.

6.2 EFFECTS OF A VALID TENDER

On making a valid tender of performance by the promisor, it becomes the duty of the promisee to accept the performance. If the promisee does not accept the valid tender, the promisor is not required to perform his promise again. The promisor is discharged from his obligation. At the same time, the promisor is not responsible for the non-performance because the promisee has not accepted the valid performance. However, the promisor does not lose his right under the contract.

Example

A agreed to deliver goods, at a specified place of B, for consideration of ₹ 5000. As per the agreement, A takes goods and delivered to B at the specified place but B rejects the deliver of goods. Here, A can recover his money or damage he has sustained.

6.3 TYPES OF TENDERS

There are two types of tenders (a) tender of goods and services and (b) tender of money. The rules for both the tenders are given here under:

6.3.1 Tender of Goods and Services

When a promisor offers the delivery of goods or services to the promisee it is said to be the tender of goods or services. If the promisee does not accept a valid tender, it will have the following effects:

1. The promisor is not responsible for the non-performance of the contract.
2. The promisor is discharged from his obligation under the contract. Therefore, he need not to offer again.
3. The promisor does not lose his right under the contract. Therefore, he can sue the promisee.

6.3.2 Tender of Money

The tender of money is an offer to make a payment. In case a valid tender of money is not accepted, it will have the following effects:

1. The offeror is not discharged from his obligation to pay the amount.
2. The offeror is discharged from his liability for the payment of interest from the date of the tender of money.

6.4 CONTRACTS WHICH NEED NOT TO PERFORM

The purpose of a contract is its performance. However, the following contracts are not required to be performed:

6.4.1 Performance Becomes Impossible

When the performance of the contract becomes impossible, it is not required to perform. In the same manner, if the subject matter for which the contract or promise is made is destroyed, the promisor gets discharged from the performance.

Example

A agrees to dance in B’s theatre for a month. A falls ill and becomes too weak to dance. The contract is void for impossibility and performance is excused by the law.

6.4.2 New Contract in Place of Old Contract

When the parties to contract agree to change, rescind or enter into a new contract, the old contract is not required to be performed. The promise under the old contract is not required to be performed.

6.4.3 Waiver by Promisee

When the promisee waives the promisor from the performance of the promise, the promisor is not required to perform his promise. Here, waiver means a sacrifice of right to get performance.

Example

A promises to paint a picture for B. B afterwards forbids him to do so. A is no longer bound to perform the promise.

6.4.4 Promise Becomes Illegal

When the performance of the promise becomes illegal, the promise is not required to be performed. An illegal thing or an object is not required to be pursued.

6.4.5 Rejection of Valid Tender

When a promisee rejects the valid tender of performance, the promisor is not liable to perform it again.

Example

A sold 100 tons of sugar to B. A tenders the delivery on Monday but B refused to accept. A is free from the obligation of performance of contract.

6.4.6 No Reasonable Facility

When a promisee does not provide a reasonable facility to a promisor to perform the promise, he gets a discharge from the performance.

Example

A contracts with B to repair B’s house. B does not point out to A, the places in the house require to be repaired. A is excused for the non-performance of the contract.

6.5 WHO CAN PERFORM CONTRACT?

At the first instance, a contract should be performed by the promisor himself. However in certain cases, the contract may also be performed by persons other than the promisor.

6.5.1 Promisor

Generally, the contract shall be performed by the promisor himself. The contract shall be specifically performed by the promisor only, when it is the intention of the promise. The contract involving personal skill or personal trust and confidence must be performed by the promisor himself.

Examples

1. A promises to paint a picture for B by a certain day at a certain price. A dies before the day. The contract cannot be enforced either by A’s representatives or by B.
2. A promises to paint a picture for B. A must perform this promise personally. Painting picture is a personal skill.

6.5.2 Legal Representative

The contract which does not involve any personal skill, may be performed by the legal representative of the promisor, on the death of the promisor. However, the liability of the legal representative under the contract is limited to the value of the property inherited. The legal representative does not have any liability under the contract, if the terms and conditions of the contract provide so.

Example

A promises to deliver goods to B on a certain day, on payment of ₹ 1000. A dies before that day. A’s representatives are bound to deliver the goods to B and B is bound to pay ₹ 1000 to A’s representatives.

6.5.3 Third Party

The third party may perform the promise if the promisee accepts the performance. When the promisee accepts the performance of the promise from a third person, he cannot afterwards enforce it against the promisor.

6.6 PERFORMANCE OF JOINT PROMISE—SECTIONS 42–45

When two or more persons enter into a joint agreement with one or more persons, in such a case, the promise is known as a joint promise. The rules relating to the performance of the joint promises are contained in Sections 42–45 of the Contract Act, 1872, and may be discussed under the following heads.

6.6.1 Promisee May Compell to Perform Any One of Joint Promisor

In the absence of any express agreement to the contrary, the promisee may compel any one or more of the joint promisors to perform the whole joint promise.

Example

A, B and C jointly promise to pay D a sum of ₹ 3000. D may compel either A or B or C to pay him ₹ 3000.

6.6.2 The Joint Promisors Are Liable to Contribute Equally

Each of the joint promisors may compel every other joint promisor to contribute equally with himself and to the performance of the promise, unless a contrary intention appears from the contract.

Example

A, B and C jointly promise to pay D a sum of ₹ 3000. C is compelled to pay the whole. C is entitled to receive ₹ 1000 each from A and B, unless a contrary intention appears from the contract among them.

6.6.3 Joint Promisors Liable to Share Loss Equally

In case, a joint promisor has been compelled to pay more than his share of liability, he can claim contribution from the other joint promisors. But if any of the joint promisors makes a default (e.g. due to insolvency) in such a contribution, the remaining joint promisors must bear the loss arising from such a default in equal shares.

Example

A, B and C are under joint promise to pay D a sum of ₹ 3000. C is unable to pay anything and A is compelled to pay the whole. A is entitled to receive ₹ 1500 from B. This amount includes ₹ 1000 as normal contribution plus equal share of the sum under default.

6.6.4 Effect of Release of Joint Promisor

A release of one of the joint promisors by the promisee does not discharge the other joint promisor or promisors and their liability continues as before.

6.7 TIME AND PLACE FOR PERFORMANCE OF PROMISE—SECTIONS 46–50

The rules relating to the time and place of performance are contained in Sections 46–50 of Contract Act, 1872, which may be discussed under the following heads:

6.7.1 Time for Performance of Promise Where No Application Is to Be Made and No Time Is Specified

Where, by the contract, a promisor is to perform his promise without an application by the promisee, and if no time for performance is specified, the engagement must be performed within a reasonable time. The question ‘What is a reasonable time’ is in each particular case, a question of fact.

6.7.2 Time and Place for Performance of Promise Where Time Is Specified and No Application to Be Made

When a promise is to be performed on a certain day and the promisor has undertaken to perform it without an application by the promisee, the promisor may perform it at any time during the usual hours of business on such a day and at the place at which the promise ought to be performed.

Example

A promises to deliver goods at B’s warehouse on the 1st January. On that day, A brings the goods to B’s warehouse but after the usual hour for closing it they are not received. A has not performed his promise.

6.7.3 Application for Performance on Certain Day to Be at Proper Time and Place

When a promise is to be performed on a certain day and the promisor has not undertaken to perform it without an application by the promisee, it is the duty of the promisee to apply for the performance at a proper place, and within the usual hours of business. The question ‘What is a proper time and place’ is, in each particular case, a question of fact.

6.7.4 Place for Performance of Promise Where No Application to Be Made and No Place Fixed for Performance

When a promise is to be performed without an application by the promisee, and no place is fixed for the performance of it, it is the duty of the promisor to apply to the promisee, to appoint a reasonable place for the performance of the promise and to perform it at such place.

Example

A undertakes to deliver a 1000 kg of jute to B on a fixed day. A must apply to B to appoint a reasonable place for the purpose of receiving it, and must deliver it to him at such place.

6.7.5 Performance in Manner or at Time Prescribed or Sanctioned by Promisee

The performance of any promise may be made in any manner, or at any time, which the promisee prescribes or sanctions.

Examples

1. B owes A ₹ 2000. A desires B to pay the amount to A’s account with C, a banker. B, who also banks with C, orders the amount to be transferred from his account to A’s credit, and this is done by C. Afterwards, and before A knows of the transfer, C fails. There has been a good payment by B.
2. A and B are mutually indebted. A and B settle an account by setting off one item against another, and B pays A the balance found to be due from him upon such settlement. This amounts to a payment by A and B, respectively, of the sums which they owed to each other.
3. A owes B ₹ 2000. B accepts some of A’s goods in deduction of the debt. The delivery of the goods operates as a part payment.
4. A desires B, who owes him ₹ 100, to send him a note for ₹ 100 by post. The debt is discharged as soon as B puts, into the post, a letter containing the note duly addressed to A.

6.8 WHO CAN DEMAND PERFORMANCE OF PROMISE?

The performance of a promise can be demanded by the promisee only. The rules in this regard are discussed as under:

6.8.1 Promisee

A promisee can demand the performance of a promise under the contract.

6.8.2 Legal Representative of Promisee

On the death of the promisee, his legal representative can demand a performance of promise except:

1. Where an agreement provides the contrary.
2. Where a contract is of a personal nature.

6.8.3 Third Party

Generally, the third party (stranger) cannot demand the performance of a promise under the contract as he is not the party to the contract. However, the third party can demand the performance of the contract in some exceptional cases like in the case of trust, the beneficiary can enforce the contract.

6.8.4 Demand by Joint Promisees

In the case of joint promisees, the demand to perform can be made based upon the circumstances as under:

1. If all the promisees are alive then all the promisees must jointly demand performance of the promise.
2. If there is a death of any of the joint promisees, the representative of the deceased promisee along with the surviving promisees can demand performance of the promise.
3. If there is death of all the joint promisees, the legal representatives of all of them can jointly demand performance of the promise.

6.9 KINDS OF RECIPROCAL PROMISE

The promise exchange for a promise is known as a reciprocal promise. In the case of a reciprocal promise, each party to contract is the promisor as well as the promisee. Lord Mansfied in the case of Jones vs Barkley classified reciprocal promises as under:

6.9.1 Mutual and Independent

When the promises are to be performed by each party independently without waiting for the other party to perform his promise, it is called as it mutual and independent reciprocal promises.

Example

A agrees to deliver goods to B. B agrees to pay ₹ 1000 for goods. Here, both parties can perform their respective promises anytime.

6.9.2 Mutual and Dependent

When the performance of one party depends on the prior performance of the other party, it is known as the mutual and dependent reciprocal promises.

Example

A agrees to deliver goods to B on advance payment of ₹ 1000. Here, A’s performance of promise is depend upon the performance of promise by B.

6.9.3 Mutual and Concurrent

When the promises are to be performed by both the parties simultaneously, it is the mutual and concurrent reciprocal promises.

Example

A agrees to deliver goods to B against cash payment of ₹ 1000 by B.

6.10 RULES REGARDING PERFORMANCE OF RECIPROCAL PROMISES

The rules regarding the performance of reciprocal promises are as follows:

6.10.1 Simultaneous Performance of Reciprocal Promise—Section 51

When a contract requires simultaneous performance of the reciprocal promise, the promisor need not perform his promise unless the promisee is ready and willing to perform his reciprocal promise.

Example

A and B contract that A shall deliver goods to B to be paid for by B on delivery. A need not deliver the goods unless B is ready and willing to pay for the goods on delivery. B need not pay for the goods unless A is ready and willing to deliver them on payment.

6.10.2 Order of Reciprocal Promise Is Fixed—Section 52

Where the order of performance of the reciprocal promise is fixed in the contract, the promise should be performed according to the order specified under the contract. If no order of performance of the promise is fixed, then it should be performed according to the nature of transaction.

Examples

1. A and B contract that A shall build a house for B at a fixed price. A’s promise to build the house must be performed before B’s promise to pay for it.
2. A and B contract that A shall make over his stock-in-trade to B at a fixed price, and B promises to give security for the payment of the money. A’s promise need not be performed until the security is given for the nature of the transaction requires that A should have security before he delivers up his stock.

6.10.3 Effect of Preventing Performance—Section 53

When one party to contract prevents the other from performing his promise, the contract becomes voidable at the option of the party so prevented and the compensation can be claimed.

Example

A and B contract that B shall execute certain work for A for ₹ 1000. B is ready and willing to execute the work accordingly but A prevents him from doing so. The contract is voidable at the option of B, and if he elects to rescind it, he is entitled to recover a compensation, from A, for any loss which he has incurred by its non-performance.

6.10.4 Effect of Default As to Promise to Be Performed First Under Contract—Section 54

If a party, who is liable to perform first, fails, he cannot demand performance from the other party and compensation. The person, who is at fault, cannot demand the performance against the other party. The defaulting party can be held liable for the payment damage, if the other party has suffered loss as a result of his failure to perform.

Examples

1. A contacts with B to execute certain builder’s work for a fixed price, B supplying the scaffolding and timber necessary for the work. B refuses to furnish and scaffolding or timber, and the work cannot be executed. A need not execute the work, and B is bound to make compensation to A for any loss caused to him by the non-performance of the contract.
2. A contracts with B to deliver to him, at a specified price, certain merchandise on board a ship which cannot arrive for a month, and B engages to pay for the merchandise within a week from the date of the contract. B does not pay within the week. A’s promise to deliver need not be performed, and B must make compensation.
3. A promises B, to sell him 100 bales of merchandise, to be delivered next day, and B promises A to pay for them within a month. A does not deliver according to his promise. B’s promise to pay need not be performed and A must make compensation.

6.10.5 Effect of Promise to Do Legal and Illegal Things—Section 57

If one contract contains two promises, out of which one is legal and the other is illegal, the first part is the contract while the second part is the void agreement if the legal promise and the illegal promise are separable from each other. But if both the promises cannot be separated from each other, the entire agreement is void.

Example

A and B agree that A shall sell a house to B for ₹ 10,000 but if B uses it as a gambling house, he shall pay A ₹ 50,000 for it. The first set of reciprocal promises, namely, to sell the house and to pay ₹ 10,000 for it is a contract. The second set is for an unlawful object, namely that B may use the house as a gambling house and is a void agreement.

6.11 TIME IS THE ESSENCE OF A CONTRACT

When a party to the contract promises to do a certain thing at or before a specified time or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract or so much of it as has not been performed becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract.

6.11.1 Effect of Such Failure When Time Is Not Essential

If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure.

6.11.2 Effect of Acceptance of Performance at Time Other Than That Agreed Upon

If in case of a contract voidable on account of the promisor’s failure to perform his promise at the time agreed, the promisee accepts the performance of such a promise at any time other than that agreed, the promisee cannot claim compensation for any loss occasioned by the non-performance of the promise at the time agreed unless, at the time of such acceptance, he gives a notice to the promisor of his intention to do so.

6.12 APPROPRIATION OF PAYMENTS—SECTIONS 59–61

Sometimes, a debtor owes several distinct debts to the same creditor and he makes a payment which is insufficient to satisfy all the debts. In such a case, a question arises as to which particular debt the payment is to be appropriated. Sections 59–61 of the act, lay down the following rules as to the appropriation of payments which provide an answer to this question.

6.12.1 Appropriation As per Express Instructions

Every debtor, who owes several debts to the creditor, has a right to instruct his creditor to which particular debt the payment is to be appropriated or adjusted. Therefore, where the debtor expressly states that the payment is to be applied to the discharge of a particular debt, the payment must be applied accordingly.

Example

A owes B three distinct debts of ₹ 20,000, ₹ 30,000 and ₹ 50,000. A sends ₹ 50,000 and instructs B that the payment should be appropriated against the third debt. He is bound to appropriate the payment against the third debt only.

6.12.2 Appropriation As per Circumstances Implying

Sometimes, the debtor makes a payment to his creditor without any express instructions as to which particular debt the payment is to be appropriated. In such a case, the creditor must appropriate the payment towards the debt to which under the implying circumstances the debtor intended to do so.

Example

A owes to B, among other debts, the sum of ₹ 520. B writes to A and demands payment of this sum. A sends to B ₹ 520. This payment is to be applied to the discharge of the debt of which B had demanded payment.

6.12.3 Appropriation of Payment Where No Express Instructions or Implying Circumstances Are There

Sometimes neither the debtor sends express instructions nor the circumstances imply as to which debt the payment is to be applied. In such a case, the creditor may apply it at his discretion to any lawful debt, actually due and payable to him from the debtor. He cannot, however, apply the payment to unlawful or disputed debt. It may also be noted that the creditor also has a right to first appropriate the payment to the interest due and then to the principal sum.

6.12.4 Appropriation in Chronological Order, i.e., in Order of Time

Sometimes neither the debtor nor the creditor makes any appropriation of the payment. In such a case, the payment shall be applied in discharge of the debts due, in order of time, whether they are, or not barred by the Law of Limitations. If the debts are of equal standing (i.e., of the same debt or time barred), the payment shall be applied in discharge of each such debt proportionately.

Example

A owes B the following debts:

Amount of the Debt	Position of the Debt
₹ 4000	Time barred.
₹ 2000	Time barred.
₹ 2000	Due on 10 June 2009
₹ 3000	Due on 20 July 2010

A sends ₹ 3000 in the month of June. He neither expressly intimates, nor circumstances of the case imply as to which debt the amount is to be applied. Moreover, B also does not appropriate the payment at his own discretion. Therefore, the payment will be appropriated in order of time. However, here in this case two debts are of equal standing. The payment will, therefore, be appropriated in order of time but to all equal standing debts. In this case, ₹ 3000 will be appropriated towards the first two debts of equal standing proportionately, i.e., in the ratio of 2:1.

6.12.5 Appropriation in Case of Current Account

In case of a current account, first debit entry is set-off against first credit entry.

6.12.6 In Case Interest is Also Due

Sometimes the debt is due with interest and the debtor makes payment of a certain sum of money. In such a case, the general rule is that the payment should be applied at the first instance to the whole interest due and thereafter to the principal, provided the parties have no contract to the contrary.

6.12.7 Payment Received in Demand for Various Debts

Sometimes, the creditor makes a demand for the payment of various debts due from the debtor and the debtor pays a part of the amount due. In such a case, the payment will be appropriated to the each debt due, proportionately.

6.12.8 Appropriation in Case of Trust Fund

Sometimes, the man keeps one bank account and makes a series of deposits and withdrawals in it of his own money as well as the money of which he is a trustee. In the course of transaction, sometimes trust funds are misappropriated. In such a case, the withdrawals are to be debited to his own money at the first instance and then to the trust fund and deposits are to be credited first to the trust fund and next to his own fund, whatever be the actual order of withdrawals and deposits.

6.13 ASSIGNMENT AND SUCCESSION OF A CONTRACT

The assignment of contracts means voluntary transfer of rights, title, interest or benefit under the contract to the third party. While succession to the contract is the process where one person succeeds in another person’s right, interest, benefit and obligation in the contract by the process of law. Only contracts which are impersonal in nature can be assigned or succeeded. The contract which is based upon the use of personal skill is a personal contract which cannot be assigned or succeeded.

The succession of the contract takes place in the following two situations:

1. In the case of death of the party to contract his legal heir succeeds to the rights and liabilities under the contract. However, he is liable for non-personal contract and liable to the extent of property inherited by him.
2. In the case of insolvency of the party to contract, his rights and liabilities under the contract are acquired by the official liquidator.

LIST OF LANDMARK JUDGEMENTS

1. Kirti Chunder vs Strathers (1878)

   Where two or more persons have made the joint promise, a release of one of such joint promisor by the promisee does not discharge the other joint promisors.

2. Taylor vs Caldwell (1863)

   If the subject matter of the contract is destroyed after the formation of the contract, without the fault of either party, the contract becomes void.

3. K. S. Vidyanandan vs Vairavan (1997)

   When time is not the essence of a contract, the promisor must perform his part of the contract within a reasonable time, and a reasonable time should be determined by looking at all surrounding circumstances, including the express terms of the contract and the nature of property.

4. Rulia Devi vs Raghunath Prasad (1979)

   Unless there is a contract to the contrary, the payment should be first appropriated towards the interest, and after the interest is fully paid off, to the principal.

5. Suresh Kumar Rajendra Kumar vs K. Assan Koya and Sons (1990)

   The tender must be for the performance of the whole obligation. But where the quantity is large, the buyer could not refuse to take the delivery of goods because the deficiency is negligible.

6. New India Motors (P) Ltd vs Smt. S. P. Duggal (1982)

   The liabilities of the legal representative under the contract is limited to the extent of the value of property inherited by them from the deceased.

7. Harikrishan Das vs Nariman (1927)

   Where there is only one debt, although payable in installments, the debtor has no right to appropriate payment to a particular installment.

8. Hind Construction Contractors vs State of Maharashtra (1979)

   If the contract includes clauses for the extension of time in certain contingencies or for the payment of fine or penalty for delay, such clauses indicate that time is not the essence of the contract.

9. Kapurchand Godha vs Nawabhimyat Ali (1963)

   The performance by the third person is also effective, if the promisee accepts for the same. Once the promisee accepts the performance from the third person, he cannot compel the promisor to perform the contract again.

10. Shirten Anderson and Co. vs Weil Bros and Co. (1972)

    The valid tender of performance must be of the whole obligation.

11. Municipal Corporation of Delhi vs Jagan Nath Ashok Kumar (1987)

    Whether time is the essence of the contract or not can be gathered from the intention of the parties and from the terms of the contract.

12. Gomathninayatam Pilla vs Palaniswani Nadan (1967)

    In the contract for sale of land or immovable property, time is not considered to be the essence of the contract.

TEST YOUR KNOWLEDGE

1. What do you understand by the performance of a contract?

   (Ref. Beginning of the chapter)

2. Write a short note on the performance of the contract.

   (Ref. Beginning of the chapter)

3. Distinguish between the actual performance of the contract, and the attempted performance of the contract.

   (Ref. Beginning of the chapter)

4. What are the requisites of the valid tender of performance?

   (Ref. Para-6.1)

5. What are the effects of refusal by the promisee, to accept valid tender of goods and services?

   (Ref. Para-6.2)

6. The tender must be conditional. Comment.

   (Ref. para-6.2)

7. The tender can be performed at any place. Comment.

   (Ref. para-6.2)

8. Write a short note on the types of tender.

   (Ref. para-6.3)

9. Is there any difference between the tender of services and the tender of money?

   (Ref. para-6.3)

10. In which circumstances the contract is not required to be performed?

    (Ref. Para-6.4)

11. The contract involving personal skill can be performed by the promisor himself. Comment.

    (Ref. Para-6.5)

12. When is the legal representative of a promisor not required to perform the promise under a contract?

    (Ref. Para-6.5)

13. When should the contract be compulsorily performed by the promisor himself?

    (Ref. Para-6.5)

14. Who can perform the promise under a contract?

    (Ref. Para-6.5)

15. Discuss the law relating to the rights and liabilities of joint promisors in the contract.

    (Ref. Para-6.6)

16. The joint promisors are liable to share losses equally. Comment.

    (Ref. para-6.6)

17. What are the rules relating to time and place of the performance of a contract?

    (Ref. Para-6.7)

18. Who can demand the performance of promise?

    (Ref. Para-6.8)

19. Explain rules with regard to demand of promise by the joint promisors.

    (Ref. para-6.8)

20. In what different ways can reciprocal promises be classified?

    (Ref. Para-6.9)

21. Reciprocal promises are always performed simultaneously. Comment.

    (Ref. para-6.9)

22. State the provisions relating to the performance of reciprocal promises.

    (Ref. Para-6.10)

23. What will be the effect, if one party to the contract prevents the other party from performing a promise?

    (Ref. Para-6.10)

24. When is time the essence of a contract?

    (Ref. para-6.11)

25. Explain the rules relating to the appropriation of a payment with suitable examples.

    (Ref. Para-6.12)

26. Write a short note on the assignment and succession of the contract.

    (Ref. para-6.13)

MULTIPLE-CHOICE QUESTIONS

1. Performance of a contract may be in the form of
   1. actual.
   2. attempted.
   3. either (i) or (ii).
   4. both (i) and (ii).
2. When the parties under the contract fulfill their respective promises, the contract is said to be discharged
   1. by breach of contract.
   2. by impossibility of performance.
   3. by agreement and novation.
   4. by performance of contract.
3. Which are the essentials of a valid tender?
   1. Tender must be unconditional.
   2. Tender must be made at a proper place.
   3. Tender must be to a proper person.
   4. All of the above.
4. The parties to a contract need not perform when the performance is
   1. dispensed with.
   2. excused under the provisions of any law.
   3. either (i) or (ii).
   4. neither (i) nor (ii).
5. A promises to deliver goods to B for ₹ 20,000. A dies before before performance of promise.
   1. The contract becomes void.
   2. The contract becomes impossible.
   3. The contract can be enforced against A’s representatives and B is bound to pay ₹ 20,000 to A’s representatives.
   4. The contract is void.
6. Who cannot demand performance of promise?
   1. Promisee.
   2. Any of the joint promisees.
   3. Legal representative on death of promisee.
   4. Stranger to the contract.
7. ‘A’ promises to act in a movie for ‘B’. In this case
   1. legal representative of A can perform the promise.
   2. A’s agent can perform the promise.
   3. A’s employer can perform the promise.
   4. A must perform this promise personally.
8. It is not always required of the parties to perform the contract ….
   1. in time.
   2. before time.
   3. personally.
   4. both (i) and (iii).
9. When two or more persons have made a joint promise, then, unless a contrary intention appears from the contract, the promise shall be performed, during their joint lives
   1. by any one of them.
   2. by a majority of the joint promisors.
   3. by all of the joint promisors.
   4. all of the above.
10. The liability of joint promisors is
    1. joint.
    2. several.
    3. joint or several.
    4. joint and several.
11. A, B, and C jointly promise to pay ₹ 1000 to D. D files a suit to recover the amount against A
    1. D must sue all of them.
    2. D can recover ₹ 100 only from A.
    3. D can recover the amount from any one of them.
    4. D cannot sue any of them.
12. If any one of joint promisors makes default in such contribution, remaining joint promisors must share the loss arising from such default
    1. equally.
    2. not equally.
    3. in the ratio of their properties.
    4. either (i) or (ii).
13. In case of a joint promise, release of one of joint promisors by the promisee
    1. discharges all promisors.
    2. discharges the other joint promisors.
    3. does not discharge the other joint promisors.
    4. discharge the promisee.
14. In a contract where time is not specified for performance, the promisor can perform the contract
    1. at any time he wishes.
    2. within the shortest time.
    3. within a reasonable time.
    4. within the latest time.
15. If a contract provides for the order of performance of reciprocal promises, the promises shall be performed
    1. in the order mentioned.
    2. in any reasonable order.
    3. in any appropriate order.
    4. in any order whatsoever.
16. The promises forming consideration for each other are called
    1. reciprocal promises.
    2. mutual promises.
    3. independent promises.
    4. none of the above.
17. The promises which are to be performed simultaneously are known as
    1. mutual and concurrent.
    2. conditional and dependent.
    3. mutual and independent.
    4. none of these.
18. Where the performance of a promise by one party depends upon the prior performance of promise by the other, the promise is known as
    1. mutual and concurrent.
    2. conditional and dependent.
    3. mutual and independent.
    4. concurrent and dependent.
19. A promises to deliver goods at B’s godown. A delivers the goods during business hours to B’s house.
    1. A has not performed his promise.
    2. A has performed his promise.
    3. B has not performed his promise.
    4. both (i) and (iii).
20. A contracts to act at a theatre for 6 months in a consideration of a sum paid in advance by B. On several occasions A is too ill to act.
    1. The contract becomes void.
    2. The contract becomes voidable.
    3. The contract becomes illegal.
    4. Any one of the above.
21. A hired a music hall to B for performing concerts. The hall accidentally burnt before beginning of the concert. The contract become
    1. void.
    2. voidable.
    3. illegal.
    4. any of the above.
22. A contracted to supply certain quantity of timber to B. Before the supply of any timber, a war broke out, resulting in disruption of supply of the timber.
    1. A was discharged from performing the contract.
    2. A was not discharged from performing the contract.
    3. A has to pay compensation.
    4. A has to pay penalty.

ANSWER KEYS

1. iii
2. iv
3. iv
4. iii
5. iii
6. iv
7. iv
8. iii
9. iii
10. iv
11. iii
12. i
13. iii
14. iii
15. i
16. i
17. i
18. ii
19. i
20. i
21. i
22. ii