By Whom Contracts Must Be Performed Under Indian Contract Act


The word "contract" is derived from the Latin term "contractum," which means "brought together". "A contract is an agreement enforceable by law," states Section 2(h) of the Indian Contract Act. According to Section 10 of the Indian Contract Act of 1872, all agreements are contracts if they are formed with free consent.

Contract performance occurs when the parties to the contract fulfill their contractual obligations within the time and manner prescribed.

Promiser and Promisee

A contract has at least two parties: a promiser and a promisee. A promisee is the one to whom a promise is made, while a promisor is the party who performs the promise. Sections 40, 41, and 42 of the Indian Contract Act of 1872 define who performs a contract.

Performance of Contract

The legal definition of "performance" is the performance of one party's obligations to the other as a result of the contract they entered into. A contract creates a legal obligation on the contracting parties to fulfill their mutual duties for the duration of the contract. The most natural and common way to cancel a contract is to breach it. A person who fulfills the terms of a contract is relieved of further obligations. In most cases, such a performance entitled him to the opposing party's performance as well. When the contract's performance meets the contractual obligations, the agreement is considered terminated.

The term "contract performance" refers to both the promisor and the promisee carrying out their contractual responsibilities. According to Section 27 of the Indian Contract Act, promises bind the promisor's representatives in the case of the latter's death before performance, unless the contract states otherwise. This means that each contracting party must carry out or offer to fulfill its promise.

By whom should the contract be performed?

A contract can be performed by −

Promisor

According to Section 40, if it appears from the nature of the contract or the parties' intention that any promise contained in it must be performed by the promisor himself, his legal representatives, or any other competent person employed by him, then such a promise must be performed by the promisor himself, his legal representatives, or any other competent person employed by him.

An Agent

An agent is a person who has been legally authorized to act on behalf of another person or organization. If the contract does not need personal consideration, the promisor or his agent may choose a competent individual or agent to carry it out. Section 40 Para 2

Legal Representative

A contract that includes the use of personal talent or is founded on personal considerations expires when the promisor dies. Of course, in the event of other contracts, the legal representatives of a deceased promisor are bound to fulfill them in accordance with Section 37, Paragraph 2.

For example, M agrees to sell his car to N in a week for Rs. 1,000,000. None the less, M dies 5 days into the contract. M's representative is obliged to sell the car to N, and N is obligated to pay M's representative Rs. 1,00,000/-.

Third Person

Section 41 says that if a promisee accepts the performance of the promise by a third party, he cannot thereafter enforce the promise against the promisor.

Joint Promisors

Devolution of Joint Liabilities (Section 42)

According to Section 42 of the Indian Contract Act, "When two or more persons have made a joint promise, then, unless a contrary intention appears in the contract, all such persons, during their joint lives and after the death of the last survivor, representatives of all, jointly, must fulfill the promise."

Devolution of Joint Rights (Section 45)

"When a person has made a promise to two or more persons jointly, then unless there is a contract to the contrary, the right to claim performance rests as between him and them, with them during their joint lives, and after the death of them, with representatives of such deceased person jointly with survivors, and after the death of the last survivor, with the representatives of all jointly".

Time and place of Performance of Promise

The contract is only performed for the promisee. A contract's performance may only be demanded by the promisee. Of course, there are several cases where a third party can enforce a promise even though he is not a party to the contract. For example, trust, marriage settlement, and so on. In the event of the promisee's death, the representative appointed by him may seek performance of the promise under a contract.

Conclusion

I would like to conclude that Sections 40, 41, and 42 of the Indian Contract Act, 1872 deal with "By whom should a contract be performed?"

Section 40

If the nature of a contract reveals that any of the parties meant for the contract's promise to be fulfilled by the promisor himself, the promisor is bound to fulfill it. Similarly, the pledge may be carried out by the promisor, his representatives, or an employed agency. If the promisor, his representatives, or his agent are unable to delegate the execution of the promise, depending on the nature of the contract, the promisor, his representatives, or his agent may fulfill the promise.

Section 41

If a promisee accepts a third party's fulfillment of a promise, the promisee cannot later enforce the promise against the promisor. As a result, even if the promisor has not authorized the third party to carry out the promise, the promisor is released from his duties when the promise is fulfilled.

Section 42

Unless clearly stated otherwise in the contract, the joint promisees are jointly obligated to fulfill the obligation. Likewise, if any of the promisors dies, their legal representatives must fulfill the pledge in collaboration with the remaining promisors. If all of the promisors die, their legal representatives must perform the promise jointly.

Frequently Asked Questions (FAQ)

Q1. Who is the person by whom the promise is to be performed?

Ans. If it appears from the facts of the case that the parties to a contract intend that any promise included in it be performed by the promisor himself, such a promise must be fulfilled by the promisor.

Q2. Who can perform a contract, and who can demand performance?

Ans. According to the general rule that "a person cannot acquire rights under a contract to which he is not a party," only the promisee may seek fulfillment of the promise under a contract. Even though the contract was made for his benefit, a third party cannot require its performance.

Q3. When should a contract be fulfilled?

Ans. Contracts are not necessary to be completed under the following conditions, according to the Contract Act: If contract parties agree to "novation,' "rescission,' or "alteration,' the original contract must be performed. In such cases, the previous contract is cancelled and replaced with a new one.

Updated on: 31-Mar-2023

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