In this essay, I will illustrate two parts which are the four ways that can terminate the contract and utilise the legal principals in relation to the termination of the contract to suggest whether Mr. Max Ang is obliged to settle the outstanding balance of $3,000.

Firstly, I will explain what the four parts is can come to the end of the contract. The four parts can terminate the contract by performance, by frustration, by agreement and by breach. The term discharge of performance pertains to the completion of contractual obligations within the outlined timeframe and in accordance with the agreed-upon conditions by all parties involved. It may be actual performance and attempted performance. Discharge of frustration occurs when unforeseen circumstances arise, rendering it impossible for the involved parties to fulfil their contractual obligations. Such unforeseen circumstances may include events beyond human control, such as natural calamities or a change in the legal framework. Discharge of agreement is the termination or modification of a contract is a possibility when both parties mutually agree. Such an arrangement can signify the conclusion of the contract or the adjustment of its terms. Discharge of contract is that a party is unable to fulfil their contractual obligations, it is considered a breach of said contract. The innocent party have rights to rescind the contract.

Secondly, I will use legal principals as well as explanation to show whether Mr. Max Ang have obligation to pay balance of $3,000. Discharge by performance had four rules: Substantial performance, Prevention of complete performance, Divisible contracts, and Acceptance of partial performance. Substantial performance is a party has effectively fulfilled their obligations, they should rightfully receive the agreed upon payment while taking into consideration any costs associated with correcting mistakes or omissions. The related case is Hoenig v Isaacs. Prevention of complete performance is a party has fulfilled some of their obligations but is impeded by the other party from carrying out the rest, the innocent party has the right to seek compensation on a quantum meruit basis for the completed work. The related case is Planche v Colburn. Divisible contracts are that each component is treated as an individual entity and has the ability to be discharged independently, consequently, this does not impact the integrity of the entire contract. Acceptance of partial performance is that one of the contracting parties has willingly agreed to accept the incomplete execution of obligations by the other party. Innocent party can claim damages. Actual performance is that once both parties have fulfilled their obligations as outlined in the contract, it is considered discharged. It is essential that performance be executed accurately and completely in accordance with the predetermined terms of the agreement. Attempted performance is that when a promisor agrees to fulfil their contractual obligation and makes an offer to do so, but the promisee declines to accept the performance, it is referred to as a discharge of the contract through attempted performance.

Discharge of frustration is an accidental event, outside the control or fault of either party, may give rise to frustration, whereby the parties are obligated to pursue a course of action vastly different from their original intentions, resulting in the fundamental destruction of the contract basis.

Discharge by agreement is permissible as long as both parties agree. Nonetheless, in cases where one party has a change of heart and wishes to reinstate their duties, enforcing the original agreement becomes possible. This is due to the absence of legal basis for an agreement to discharge obligations, despite its validity. It is recommended that parties enter a second contract that explicitly binds them to their promise to discharge obligations as per the initial contract.

Discharge by contract is in situations where one or both parties fail or refuse to fulfil their contractual obligations. There are three types of term breached: Conditions, Warranties, and Innominate terms. Conditions are the most important term, and it can go to the very root of the contract. It can terminate the contract and sue the damage if breached. The related case is Poussard v Spiers. Warranties are less important term, and it cannot go to the very root of contract. It can only sue for damage if breached. The related case is Bettini v Gye. Innominate terms are based on the seriousness of the breach. If breached in a serious way, the innocent party can set aside and sue for damage. If breached in a trivial way, the innocent party can only sue for damage.

Discharge of Contract by Performance, Breach, or Agreement (lawteacher.net)