Juan and Isidro enter into a contract to buy, restore and reopen the Coastal Park Carousel. Before either party begins to perform, they agree to cancel their deal. This is
A) specific performance.
B) mutual rescission.
C) accord and satisfaction.
D) novation.

Question

Juan and Isidro enter into a contract to buy, restore and reopen the Coastal Park Carousel. Before either party begins to perform, they agree to cancel their deal. This is
A) ​specific performance.
B) ​mutual rescission.
C) ​accord and satisfaction.
D) ​novation.

Quizplus · Accepted Answer

Mutual rescission occurs when both parties agree to cancel a contract before any performance has taken place. This is the case in the scenario given, where Juan and Isidro agree to cancel their deal before beginning to perform. Specific performance refers to a court order requiring a party to perform a specific action under the terms of a contract. Accord and satisfaction refers to an agreement between parties to settle a debt for less than the full amount owed. Novation refers to the substitution of a new contract or party for an existing one. None of these apply to the scenario described.

Juan and Isidro Enter into a Contract to Buy, Restore