X, Y and Z jointly promise to pay ₹600 to A. Z was compelled to pay the whole amount, X was declared insolvent, however his assets are sufficient to pay one-half of his debt. State the liability of X, Y and Z under the I
CS Executive · Economic and Commercial Laws · PYQS · June 2021
X, Y and Z jointly promise to pay ₹600 to A. Z was compelled to pay the whole amount, X was declared insolvent, however his assets are sufficient to pay one-half of his debt. State the liability of X, Y and Z under the Indian Contract Act, 1872.
Answer & Explanation:
Under Section 43 of the Indian Contract Act, 1872 where two or more persons made a joint promise, the promisee may, in the absence of an express agreement to the contrary compel any one or more of such joint promisors to perform the whole of the promise. Each of two or more joint promisors may compel every other joint promisor to contribute equally with himself to the performance of the promise unless a contrary intention appears from the contract. If any one of two or more promisors make default in such contribution, the remaining joint promisors should bear the loss arising from such default in equal share. In the light of the above provisions, Z who has paid the whole amount will be entitled to receive ₹100 from X's estate and ₹250 from Y. X will be liable for ₹100. Y will be liable for ₹250. Z will be liable for ₹250.
Topics: Indian Contract Act, 1872
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