Question

Accepting any other satisfaction than the performance originally agreed is known as

• A. reciprocal agreement
• B. reciprocal acceptance
• C. reciprocal accord and satisfaction
• D. accord and satisfaction

Hint:

Remember the formula: \textbf{Accord (New Agreement) + Satisfaction (New Performance) = Discharge of Old Obligation}. This distinguishes it from Novation (substituting a new contract) or Remission (accepting lesser performance of the same kind).

Answer 1

The Correct Option is D

Step 1: Understanding the Concept:
The question describes a method of discharging a contract where the parties agree to substitute the original performance with a new one. This is a common law concept recognized under the Indian Contract Act, 1872 (e.g., under Section 63).
Step 2: Detailed Explanation:
The term for this concept is Accord and Satisfaction. It consists of two parts: \begin{enumerate} \item Accord: This is the new agreement by which the parties agree to accept some performance or satisfaction other than what was originally due under the contract. It is the agreement to discharge the existing obligation. For example, A owes B Rs. 10,000. They agree (the accord) that A will deliver a specific painting to B in full settlement of the debt. \item Satisfaction: This is the actual performance of the new agreement (the accord). When A delivers the painting to B (the satisfaction), the original debt of Rs. 10,000 is discharged. \end{enumerate} An accord without satisfaction is generally not a valid discharge of the original contract. The combination of the new agreement (accord) and its performance (satisfaction) is what extinguishes the original contractual obligation.
Step 3: Final Answer:
Accepting any other satisfaction than the performance originally agreed is known as accord and satisfaction.