Question

In the law of contract, once the contracting parties agree and the contract is entered into, nothing can spoil, impair or destroy the contract.Discuss

Answer 1

Impossibility of Performance

Performance: To take effect, people entering a contract need to take action of some sort, which is referred to as performance.

• If, for instance, a speaker for an event is being hired by a company, the signing of a contract is required.
• After the speaker that was hired has fulfilled the duties outlined in the contract, performance has taken place.
• However, if, for some reason, the speaker is unable to commit to his or her tasks as per contract, this is called the impossibility of performance.
• In this case, the contract can be terminated by the contract.
• Another example is a contract for a musical; if the actor is unable to perform, the contract can be ended.

Breach of Contract

If one party knowingly does not stick to the agreements in the contract, it is breached and can be terminated by the other party.

• Should one of the parties that entered into the contract not fulfill its responsibilities, either partially or even fully, a breach occurs.
• Whenever a material contract breach happens, the affected party can request monetary payment for the damages, yet not for an immaterial breach.
• As an example, if a delivery arrives a day late, that is most likely not a material breach of contract.
• Nevertheless, a material breach happens when the purchased product arrives significantly later, which then financially affects your business operations.

• Prior Agreement

  An agreement prior to entering into a contract that states a specific reason for terminating a contract allows for ending the contract if this reason is taking effect.

• To end the contract without breaching it, specifics and conditions of this valid reason must be found in the prior agreement.
• Moreover, the detailed process of how to terminate the contract in case the agreed on reason becomes invalid should be described in the prior agreement.