Page 66 - DMGT102_MERCANTILE_LAWS_I

Mercantile Laws-I

Notes 5.1 Meaning of Performance of Contract

A contract creates obligations. ‘Performance’ of contract means the carrying out of obligations
under it. The parties to contract must either perform or offer to perform their respective promises
unless such performance is dispensed with or excused under the provisions of the Indian Contract
Act, or some law (s.37).

5.1.1 Meaning of Offer to Perform

It may happen that the promisor offers performance of his obligation under the contract at
the proper time and place but the promisee refuses to accept the performance. This is called
as ‘Tender’ or ‘Attempted Performance’. If a valid tender is made and is not accepted by the
promisee, the promisor shall not be responsible for non-performance nor shall he lose his rights
under the contract. However, since the tender is an offer to deliver anything to the promisee, the
promisee must have a reasonable opportunity to see that the thing offered is the thing contracted
for.

5.1.2 Who must Perform the Promise under a Contract?

The promise may be performed by promisor himself or his agent or by his legal representative.
(i) In case, there was an intention of the parties that the promise must be performed by the
promisor himself, such promise is to be performed by him only. Thus, where A promises to paint
a picture for B, then A must perform this promise personally. (ii) If there is no such intention of
the parties, then the promisor may employ a competent person to perform the promise. If A has
promised to deliver some items of grocery to B, A may perform this promise either personally
delivering the items to B or causing it to be delivered to B through someone. (iii) In case of death
of the promisor, the legal representative must perform the promise unless a contrary intention
appears from the contract. A promises to deliver goods to B on a certain day on payment of `
1,000. A dies before that day. A’s legal representatives are bound to deliver the goods to B, and B
is bound to pay ` 1,000 to A’s representatives. (iv) Where, however, a contract involves personal
skill, then it comes to an end with the death of the promisor. Thus, where A promises to paint
a picture for B by a certain day but dies before that day, the contract cannot be enforced by A’s
representatives or by B.
Performance of joint promises. The Act provides rules for devolution of joint liabilities and
rights.

Devolution of joint liabilities. Section 42 requires that when two or more persons have made a
joint promise, then, unless a contrary intention appears from the contract, all such persons jointly
must fulfil the promise. In the event of death of any of them, his representative jointly with the

survivor or survivors and in case of the death of all promisors, the representatives of all of them

jointly must fulfil the promise.
Liabilities of joint promisors. When two or more persons make a joint promise, the promisee
may, in the absence of an express agreement to the contrary, compel anyone or more of such joint
promisors to perform whole of the promise. Thus, the liability of joint promisors is joint as well
as several [s.43]. Thus, s. 42 makes all the joint promisors liable on the promise jointly, whereas s.
43 provides that any one of the joint promisors may be compelled to perform.

Example: A, B and C jointly promise to pay D ` 3,000. D may compel either A, or B or C or
any two of them to pay him ` 3,000.
Right of contribution amongst joint promisors. Where, a joint promisor has been compelled
to perform the whole promise, he may compel every other joint promisor to contribute equally

60 LOVELY PROFESSIONAL UNIVERSITY