Peter owes Rs 100,000 to John and agrees to repay it within one year. They document the
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Peter owes Rs 100,000 to John and agrees to repay it within one year. They document the debt under a contract. Subsequently, he loses his job and requests John to accept Rs 75,000 as a final settlement of theloan. John agrees and they make a contract to that effect.
- Explain what type of discharge of contract does this situation fall under?
- When John makes a new contract, does that affect the original contract they initially made between each other? If yes, how?
- What is the status of liability that is attached to the performance of original contract? Does the new contract discharge Peter of his liability under the contract or not?
- When Peter loses his job and offers an amount of Rs. 75000 as final settlements, what right does this confer on John?
- Was Peter in breach of contract? If yes, was it actual breach or anticipatory
Related Book For
Intermediate Accounting
ISBN: 978-0470161012
9th Canadian Edition, Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.
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