Question

_________ is not the way of discharge of contract by mutual agreement or consent.

• A. Surrender
• B. Novation
• C. Merger
• D. Waiver

Answer 1

The correct option is A Surrender

A contracts is discharged when the obligations created by it come to an end. A contract may be discharged in various ways and one such is by mutual agreement or consent. Section 62-64 of the Contract Act deals with the same and provides for various modes through which contract will be discharged. These are:

• Novation- Substitution of a new contract in place of the old existing one is known as ‘novation of contract’. New contract may be either between the same parties or between different parties, the consideration being mutually the discharge of the old contract.
  
• Rescission- It means cancellation of the contract. A contract can be rescinded by mutual consent before it’s breach or by the aggrieved party for the breach of contract or by the party whose consent is not free
  
• Waiver- A contract may be discharged by agreement between the parties to waive their rights arising from the contract. Thus, in case of waiver, the person who is entitled to any right under the contract, intentionally relinquishes them without consideration and without a new agreement.
  
• Remission- Remission means acceptance of a lesser performance than what was actually due under the contract. According to Sec. 63 a party may dispense with or remit, wholly or in part, the performance of the promise made to him.
  
• Surrender- It is a type of rescission by which both the parties extinguish their respective rights.
  

On the other hand, 'merger' is a mode of discharge of contract by operation of law and not by mutual agreement.