Question

X is a tenant of Y under a lease agreement. Subsequently X purchased the same flat. The lease agreement is discharged due _____________.

• A. Remission
• B. Merger of rights
• C. Lapse of tenancy right
• D. Novation

Answer 1

The correct option is B Merger of rights

Here, X was earlier a tenant under a lease agreement but when he purchased the flat he was a buyer under a new sale agreement which discharges the old lease agreement. Hence, as per section 62, 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.