Rahul was a Disk Jockey at a five-star hotel. As per the contract, he is supposed to perform every weekend. (i.e. twice a week). Rahul will be paid ` 2,500 per day. However, after a month, Rahul willfully absents himself from the performance. Taking into account the provisions of the Indian Contract Act, 1872, answer the following: (i) Does the hotel have the right to end the contract? (ii). If the hotel sends out a mail to Rahul that they are interested to continue the contract and Rahul accepts, can the hotel rescind the contract after a month on this ground subsequently? (iii) In which of the case – (termination of contract or continuance of contract) can the hotel claim damages that it had suffered as a result of this breach? OR Sheena was a classical dancer. She entered into an agreement with Shital Vidya Mandir for 60 dance performances. As per the contract, she was supposed to perform every weekend and she will be paid ` 10,000/- per performance. However, after a month, she was absent without informing, due to her personal reasons. Answer the following questions as per the Indian Contract Act, 1872. (i) Whether the management of Shital Vidya Mandir has right to terminate the contract? (ii) If the management of Shital Vidya Mandir informed Sheena about its continuance, can the management still rescind the contract after a month on this ground subsequently? (iii) Can the Shital Vidya Mandir claim damages that it has suffered because of this breach in any of the above cases?

By analysing Section 39 of the Indian Contract Act, 1872, it is understood that when a party to a contract has refused to perform or disabled himself from performing his promise entirely, the following two rights accrue to the aggrieved party (promisee): (a) To terminate the contract (b) To indicate by words or by conduct that he is interested in its continuance. In either of the two cases, the promisee would be able to claim damages that he suffers. In the given case, (i) Yes, the hotel has the right to end the contract with Rahul, the DJ. (ii) The hotel has the right to continue the contract with Rahul. But once this right is exercised, it cannot subsequently rescind the contract on this ground subsequently. (iii) In both the cases, the hotel (promisee) is entitled to claim damages that has been suffered as a result of breach. OR Section 39 provides that when a party to a contract has refused to perform or disabled himself from performing his promise in its entirety the promisee may put an end to the contract unless he had signified, by words or conduct his acquiesce in its continuance. Further, in term of Section 40, the promisee shall be required to perform personally, if there is such an apparent intention of the parties. Also, as per Section 75 of the Act, a person who rightfully rescinds a contract is entitled to compensation for any damage which he has sustained through non-fulfilment of the contract. Therefore, in the instant case, (i) Since, Sheena could not perform as per the terms of contract, Shital Vidya Mandir can terminate the contract. (ii) In the second situation, the management of Shital Vidya Mandir informed Sheena about the continuance of the contract. Hence, the management cannot now rescind the contract after a month on this ground subsequently. (iii) As per Section 75, Shital Vidya Mandir can claim damages that it has suffered because of this breach in part (i).