Book Opener

Mutual ReleaseJodi and Mark mutually agreed to end their agreement. A mutualrelease is an agreement between two parties to end an agreement. Bymutual agreement, the contract no longer exists. Whatever parties agreeto do in the first place, they may later mutually agree not to do. Otherwise,there would be no consideration for the promised release.Accord and SatisfactionA contract also can be discharged when one party to an agreementagrees to accept performance from the other party that is different fromwhat was agreed upon in the original contract. In effect, one contract issubstituted for another, which is known as accord and satisfaction .Accord and satisfaction is often used to settle an honest disagreementor unforeseen circumstances regarding an amount owed.Example 7. Lawrence Langham contracted to sell his tractor toJerry Bodoni for $1,200. Before the sale is completed, Bodonisuffers several financial reversals and no longer has the cash to payfor the tractor. Bodoni explains the situation to Langham and offersto give Langham his DVD player, video camera, and color televisioninstead of the $1,200. If Langham accepts these items, Bodoni’spromise to pay the $1,200 is discharged. However, Langham mustactually accept the items. The promise to accept the items is theaccord. The carrying out of the promise is the satisfaction.Reviewing What You Learned1. What is a reasonable time for completing acontract?2. What is the difference between satisfactoryand substantial performance of a contract?3. What is tender of performance?4. How can contracts be discharged byagreement?Critical Thinking ActivityDischarge by Agreement Why does the courtpermit certain contracts to be discharged byaccord and satisfaction?Legal Skills in ActionAccord and Satisfaction Last week, yourfriend Cynthia used a credit card to purchase asnowboard for $277.89. This week she saw thesame snowboard on sale for $250.43 at anotherstore. Cynthia believes she can use accord andsatisfaction to pay the lesser amount when hercredit card bill comes in the mail. Send Cynthiaan e-mail message explaining why accord andsatisfaction will not work in this case.230 Unit 2: Entering Into Contracts