According to Section 54 of the Indian Contract Act, 1872, what is the consequence when a contract consists of reciprocal promises, such that one cannot be performed until the other has been performed, and the party who of necessity ought to perform first fails to perform?

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Law · Legal Studies

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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The party failing to perform cannot claim the performance of the reciprocal promise, and must make compensation to the other party for any loss.

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Answer 1

The party failing to perform is entitled to seek legal remedies to enforce the reciprocal promise.

Answer 2

The contract automatically becomes voidable at the discretion of the party who failed to perform.

Answer 3

The party failing to perform cannot claim the performance of the reciprocal promise, and must make compensation to the other party for any loss.

Answer 4

The party failing to perform can still demand the fulfillment of the reciprocal promise from the other party.

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