PERFORMANCE OF THE
CONTRACTS UNDER
CONTRACT ACT 1872.
MUHAMMAD JUNAID AKHTAR
LECTURER
DEPARTMENT OF LAW
THE UNIVERSITY OF FAISALABAD
Introduction to the Performance of the Contracts
⚫Performance of the contract means the fulfillment of
legal obligations created under the contract law by
both the parties to the contract.1.e
⚫Offerer/promisor
⚫Acceptor/Offeree/Promisee
After the performance of the contract the contract
comes to an end. i.e the deal is fulfilled and both the
parties are free from the obligations, rights and
duties.
WHO MAY PERFORM THE CONTRACT
As a general Rule it depends on the terms and
conditions of the contract for the performance of the
contract.
⚫ Performance According to the terms and
Conditions of the Contract:
Promisor will perform his part of the contract
The promisee will perform his part of the contract
according to the terms and conditions of the
contract.
Example
⚫ A the promisor (A Construction Contractor) promise to
build one kanal house for Mr B the promisee within one
year time period for 3 crore rupees. The payments will be
in installments in the following manner.
⚫ Basement floor completion and mr B will deliver one crore
⚫ First Floor completion and mr B will deliver one crore
more to Mr.A
⚫ 2nd Floor Completion and Mr B will deliver last installment
of one crore with full fledged complete house and hand
over the keys to Mr. B.
WHO MAY DEMAND THE PERFORMANCE OF
THE CONTRACT
⚫ Demand for performance can only be done by the
promisee of the contract or any person authorized
by promisee with the consent of Promisor.
⚫ A promise to give debt to B….it is only B to demand
for the performance of the contract or his authorized
agent or representative.
⚫ Stranger to the contract can not demand for the
performance to the contract Unless the person is
the authorized agent or representative to the either
parties.
⚫ Doctrine of privity to the contract law is a principle
which prevents a person who is not a party to a
contract from enforcing a term of that contract, on
behalf of one of the parties even where the contract
was made for the benefit of the third party/
⚫ Only parties to the contract can sue each other and
not the stranger or third party to the contract.
⚫ In many cases the contract formation and
performance take place at the same time in those
transaction there is no such complications for the
demand of performance of the contract.
⚫ Example;
⚫ A offer iphone cell phone at the shop,B accepts the
offer and pay the money. The performance of the
contract is accomplished and the deal is done.
Performance by the Promisor and its Formalities
⚫As a general Rule a contact may be performed by the
promisor either personally or through other
competent person or agent or representative.
A Promisor Himself:
If any contract involves personal skills to perform a
contract than the promisor has to perform that
contract personally and no delegation of
performance to his agent or competent person is
allowed to perform that contract.
E.G Appointment with specific doctor for surgery,
lawyer ,painter, car mechanic etc
THE SITUATIONS WHERE THE THIRD PERSON MAY DO
THE PERFORMANCE OF THE CONTRACT.
⚫ Where performance done by the third person.
⚫ The promisor or his Agent:
⚫ If the contract does not demand the personal skill of the promisor and
the work could be done by any one, the promisor or his agent, with the
consent of the promisee and this contract is known as novation(New
contract with the same parties but with different terms and conditions)
the promisor may delegate the power to his agent or representative to
perform the contract under his authority.
Example:
A promises B to sell his car and will deliver the car to B house personally
on payment by B.
Here the promisor may drive the car to his home himself or through his
authorized agent but with the consent of the promisee.
⚫ The Legal Representative:
⚫ In case of the death of the promisor where is the contract is
of a personal nature or required personal skills to perform
the contract the legal representatives are not bound to
performed that contract.e.g surgery by a doctor, painting
contract, any particular lawyer to fight a case etc It is
subsequent impossibility and the contract are impossible
to be performed by the legal representatives.
⚫ But All those contracts which are not dependant on
personal skills and ability of the deceased the legal
representatives bound to perform the contract not from
their own pockets but from the property of the deceased
property e.g. contract of debts.
Example
⚫ A promise to paint a picture to B on a 10.1.2021 at 5
thousand rupees. A dies before completion of painting on
05.1.2021. The heirs or legal representatives are not liable
to perform the contract.
⚫ But if A promise to pay B 4000 rupees and before payment
A dies the liability of performance passes to the legal heirs
and representative BUT from the property of the person
died, if the deceased or dead person has no personal
property, the legal representatives have no liability to pay
from their own property or pockets.
Example No.2
⚫ A promises to deliver 10 bags of rice to B on fixed
date. A dies before that date, the Legal
representatives are bound to perform the contract
and deliver 10 bags of rice to B on payment.
PERFORMANCE OF JOINT PROMISES
Where there are several promisors who promise
jointly to a single promisee.
For example:
A,B,C the promisors jointly promise D the promisee
for the payment of 3000 rupees
The promisee can sue one or more of them or all of
them jointly. The choice is that of promisee
Where A,C jointly promise to pay 3000 rupees in this
case D can compel either A,B or C individually or all
of the promisors jointly to pay Rs 3000
⚫ If One of the promisors is made to pay the whole
amount 3000 rupees, he can later on compel the
others promisors for contribution or he can recover
from them later on.
⚫ Or if one of the promisors is surety for the other or
others to pay, the surety will have the right to claim
from the that person later on.
⚫ If One of the promisors can not pay, the others are
liable to pay for the entire obligations.
For Example: A,B,C Jointly promise to pay D 3000
rupees and A becomes insolvent and C have to pay
the entire amount of 3000 to D.
⚫ If one of the promisors let suppose become
insolvent, or has no wealth, the others promisors
will have to meet the entire obligations.
⚫ If the promisee releases one of promisors from the
liability, in joint promise, his liability to the
promisee ceases but not to the other promisors to
pay the contribution.
⚫ A,B and C are under a joint promise to pay 3000
rupees to X,X may release C from his liability but A
and B remain liable to pay to X the whole amount of
3000 thousand rupees. C is release from liability to
X ,But not to A and B, and A and B have the right to
claim of contribution 500 rupees each from C.
Or
Where a single promisor promise to several promisees jointly
For Example: A promise to pay C,D,E jointly 3000 rupees.
C,D,E may jointly ask for the performance of the contract
from A and distribute equally or any one of C D OR E ask
from the promisor to perform the contract and ask for the
whole amount of 3000 thousand,once the whole amount is
paid to any promisee the promisor has discharged from his
liability and the others can not compel promisor to pay
them and the others can ask from the one who has been
paid the whole amount of 3000 to pay them equally.
⚫ Where several promisors jointly promise to several promisee jointly
⚫ For Example:
A B C jointly the promisor jointly promise to pay D E F jointly 3000
rupees.
Any promisee individually ask for the money to pay from all the
promisors or compel any one of them to pay the whole amount.
If any promisee compel any one promisor for the whole amount, the
promisor who paid the whole amount will have to ask from the others
promisors the contributions.
As for as the promisee who recovers the whole amount from one
promisor or all promisors will distribute equally the promise amount
among each others.
Where time is the essence of the performance of the contract
⚫The performance of the contract must be performed
in the specified time in usual hours of business, date
and place which is agreed upon the parties.
⚫If the contract is not performed within specified
time, date and place the contract will become
voidable at the option of the aggrieved party.
⚫Example:
A promise to deliver B 50 bags of sugar of 5th january
2021 at 1pm at his bunsiness place.
A delivers 50bags of Sugar to B on 5th juanuary before
1pm.A has performed the contract at time.
⚫ If no time and date is specified in the contract for the performance of
the contract between the parties, than the contract must be performed
within (A)reasonable time on working day and Bussiness
hours in pakistan the bussiness hour usually starts from
9AM TO 5 PM (B) At proper place
⚫ At Proper place: the proper place in case of not mentioned in the
contract would be the place of bussiness,godown or shop, warehouse
etc.
⚫ At the time of the contract it is best to mentioned the time, place and
date of the delivery of goods between the promisor and the promisee
and the promisor shall ask the promisee where shall I deliver the goods,
time and place of delivery to avoid any trouble and confusion.
EFFECT OF FAILURE TO PERFORM A CONTRACT
⚫The effect of failure to perform a contract within the
specified time as under section 55 provides the
following rules.
⚫When time is the essence of the contract:
Where time is of the essence of the contract and there
is failure to perform within the fixed time the
contract becomes voidable at the option of the
[Link] may revoke the contract and sue for
the breach of contact and damges.
Example
⚫ A agreed to deliver 20 bags of rice to Y On
[Link] x failed to deliver by that time. The
contract is voidable at the option of Y the promisee.
⚫ Remedies for the promisee:
⚫ Rescind or cancellation of contract with
damages.
⚫ Sue for damages and carry on the contract
⚫ WHERE TIME IS NOT OF THE ESSENCE OF
CONTRACT:
⚫ Where time is not of the essence of the contract the
performance must be done within reasonable time
and if there is a failure to perform within
reasonable time the contract remains valid and the
promisee will have to accept the delayed
performance but may claim for damages to the loss
because of the unreasonable delay.
⚫ Reasonably of performance depend on case to case
and has no fixed rules set for it.
For example
⚫ If the time of the performance of the contract for the
delivery of fresh fruit is not fixed….
⚫ What could be the reasonable time to deliver the
fresh fruit at the place of promisee…????
⚫ A order B for the delivery of fresh egg to his shop
but without mentioning the time and date…How
and when the performance will be done By B…?
Acceptance of Delayed performance in Case of date and time
fixed
⚫ When the promisee accepts the delayed
performance In case of the date and time is fixed by
the promisee, without cancelling or rescinding the
contract or asking for any damages for the loss
occurred to the promisee, later on the promisee can
not rescind or claim damages for the delayed
performance, once he accepts the delayed and it
comes in the knowledge of the promisor either
expressly or impliedly by his conduct, the promisee
has discharged his remedies availed to him.
Mode of Performance of the contract
⚫ By the mutual understanding of the parties to the
contract.
⚫ According to the terms and conditions of the parties.
⚫ According to the directions and prescription of the
promisee.
Contracts which Need Not to Be performed
⚫Termination by agreement between the
parties with consent
when parties to the contract with mutual consent
terminated the performance of the contract. Then in
that case there is no need to perform the contract
⚫By Novation of the Contract:
Novation means wiping out of the original contract as
well as the creation of a new valid contract. it is the
extinguishing of the terms and conditions of the old
contract by modifing,altering or rescinding, so as to
emerge an new altered or substituted valid contract.
Example
⚫ A agrees to B that A will give his university fees of
first semester in two equal installment….later on A
was not able to pay the fees in two installed and
requested B that I am ready to pay the fees of First
Semester but in three equal installments,
⚫ Now if B agrees than only in that situation the new
contract will sign with the same parties but with new
terms and conditions of three equal installments
rather than two equal installments.
⚫ In this case the new contract will not be performed
and will be terminated and new contract will be
performed.
⚫ Remission by promisee:
Every promisee may remit wholly or part of the
contract promised to performed by the promisor
and that remission may discharge the performance
as a whole contract if remission is for the whole
contract or remit part of the contract which is
remitted by the promisee.
Example
⚫ A the debtor and promisor, promise to pay back B
the creditor and promisee 5000 rupees as debt was
given to A by B.
⚫ B remits the whole debt and the contract was
terminated or performance was discharged by
remission.
Voidable contract
⚫ All voidable contract which is at the option of the
aggrieved party as far as the performance of the
contract is concerned.
⚫ Voidable contract are performed at the will of the
aggrieved party, if he does not wish to performed the
contract can cancel the contract and ask for
damages.E.g Contract of coercions, fraud and
misrepresentation.
Refusal by the promisee to direct the promisor a proper time,
place and location for the performance of the contract.
⚫ If any promisee neglects or refuses to properly assist
and point out the exact place and time for the
delivery of goods after repeating calls and
notifications but the promisee intentionally refuses
to properly direct the promisor for the delivery of
goods or consignments, the promisor is excused
from the performance of the contract.
Example
⚫ A contracts with B to repairs B house. A
intentionally refuses to point out his House to B.B
is excused for the non-performance of the contract
in this case.
