Reciprocal Promise | Legal rules | Indian Contract Act | Law | BRF | BCom | VNSGU

Reciprocal Promise: 
Promises forming consideration or part of consideration to each other are called Reciprocal promise 2(f)

Legal Rules:
1) Promisor is not bound to perform unless other party is ready and willing to perform (sec 51):
In cases of contracts consisting of reciprocal promises, no promisor need perform his promise, unless the promisee is willing and ready to perform his reciprocal promise. e.g. (a) A and B contract that A shall deliver goods to B to be paid for by B on delivery A need not deliver the goods, unless B is ready and willing to pay for the goods on delivery. B need not pay for the goods unless A is ready and willing to deliver them on payment.

(2) Order of performance (Sec. 52) :
Where the order in which reciprocal promises are to be performed is expressly fixed by the contract - they are to be performed in that order and where the order is not expressly fixed by the contract - they are to be performed in that order which the nature of the transaction requires. e.g.. A and B contract that A shall build a house for B at a fixed price. A's promise to build the house must be performed before B's promise to pay for it.

(3) When a party prevents other party from performing his part of promise [Sec. 53]
When a contract contains reciprocal promises and one party to the contract prevents the other from performing his promise the contract becomes voidable at the option of the party so prevented and he is entitled to compensation from the other party for loss if any, which he may sustain in consequence of the non-performance of the contract. e.g., A and B contract that B shall execute certain work for A for a thousand rupees. B is ready and willing to execute the work accordingly but A prevents him from doing so. The contract is voidable at the option of B and if he elects to rescind it. he is entitled to recover from A compensation for any loss which he has incurred by its non-performance.

(4) Default made by the party who was bound to perform first in reciprocal promise (Sec. 54)
Where a contract consists of a reciprocal promises such that one of them can not be performed or that its performance can not be claimed till the other has been performed and the promisor of the promise last mentioned fails to perform it - such promisor cannot claim the performance of the reciprocal promise and must make compensation to the other party to the contract for any loss which such other party may sustain by the non performance of the contract.

(5) Reciprocal promise to do legal things and also other illegal things (Sec. 57)
Where persons reciprocally promise, firstly to do certain things which are legal and secondly under specified circumstances, to do certain other things which are illegal - the first set of promises is a contract, but the second is a void agreement. e.g.. A and B agree that A shall sell B a house belonging to A for Rs. 10,000 but that if B uses the house as a gambling house, B shall pay Rs. 50,000 for it. The consideration was to be paid at the end of one year. A executes the conveyance in favour of B. Three months thereafter. B uses the house as a gambling house, though one year passes away. B fails to pay any sum to A. Here the first set of reciprocal promises, namely to sell the house and to pay Rs. 10,000 for it is a contract. But the rest is for an unlawful object namely that A may use the house as a gambling house and is a void agreement.




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