Theory question 106
Law of ContractCommerce 2 (essay)
(a) What is a contract?
(b) List and explain four ways by which a contract can be discharged.
Show the model answer
Model answer
(a) A contract is an agreement between two or more parties that is enforceable by law; it may be oral or written.
(b) Any four, explained: by performance – both parties do what they promised; by agreement – parties agree to end it; by breach – one party fails to perform, freeing the other; by frustration – an event beyond control makes performance impossible (e.g. destruction of the subject matter); by operation of law – death, bankruptcy, or a change in law; by lapse of time – a contract for a fixed period ends.
Explanation
Name each way and give a short explanation or example.