How does a valid contract get discharged by impossibility of performance ?

CS Executive · Economic and Commercial Laws · PYQS · June 2016
How does a valid contract get discharged by impossibility of performance ?

Answer & Explanation:

Section 56 of the Indian Contract Act, 1872 deals with the provision of discharge of contract by impossibility of performance. A contract which is entered into to perform something that is clearly impossible is void. Sometimes subsequent impossibility (i.e. where the impossibility supervenes after the contract has been made) renders the performance of a contract unlawful and stands discharged. In this connection Section 56 provides that 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 perform, unlawful, becomes void when the act becomes impossible or unlawful. If the impossibility is not obvious and the promisor alone knows of the impossibility or illegally then existing or the promisor might have known as such after using reasonable diligence, such promisor is bound to compensate the promisee for any loss he may suffer through the non-performance of the promise inspite of the agreement being void ab-initio. Illustrations A agrees with B to discover treasure by magic. The agreement is void. A and B contract to marry each other. Before the time fixed for the marriage, A goes mad. The contract becomes void.

Topics: Indian Contract Act, 1872

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