When it comes to contracts, there are a variety of ways in which they can be discharged. One such way is through mutual agreement between both parties involved. However, it`s important to note that not all means of mutual agreement will result in a valid discharge of a contract. Here are the options and the one that is not a valid way to discharge a contract by mutual agreement.
1. Rescission: This occurs when both parties agree to cancel the contract altogether, releasing each other from all obligations outlined in the agreement.
2. Novation: This is the process of substituting a new party or a new obligation for an existing one. In other words, it`s an agreement to replace one party or obligation with a new one.
3. Accord and Satisfaction: This occurs when both parties agree to settle a dispute by agreeing to a new obligation or payment. Essentially, one party agrees to perform a new obligation or pay a new sum of money in exchange for the release of the other party from their previous obligation.
4. Performance: This is arguably the most straightforward way in which a contract can be discharged. When both parties fulfill all obligations outlined in the agreement, the contract is considered discharged.
Now, out of all the options listed above, the option that is not a valid way to discharge a contract by mutual agreement is performance. While it is true that performance can result in the discharge of a contract, it cannot be considered a way in which a contract is discharged by mutual agreement. Performance is simply the fulfillment of the obligations outlined in the agreement, which is not the same as an agreement between both parties to discharge the contract.
All in all, it`s important to understand that mutual agreement can lead to the discharge of a contract in a variety of ways. From rescission to accord and satisfaction, there are several options available to both parties involved in a contract. However, it`s also important to note that not all means of mutual agreement will be valid in discharging a contract. By understanding the options available and their requirements, you can ensure that your contracts are discharged in a legal and binding manner.