Substituted performance of contracts, etc.

20.  Substituted performance of contract.- (1) Without prejudice to the generality of the provisions contained in the Indian Contract Act, 1872 and, except as otherwise agreed upon by the parties, where the contract is broken due to non-performance of promise by any party, the party who suffers by such breach shall have the option of substituted performance through a third party or by his own agency, and, recover the expenses and other costs actually incurred, spent or suffered by him, from the party committing such breach.

(2) No substituted performance of contract under sub-section (1) shall be undertaken unless the party who suffers such breach has given a notice in writing, of not less than thirty days, to the party in breach calling upon him to perform the contract within such time as specified in the notice, and on his refusal or failure to do so, he may get the same performed by a third party or by his own agency:                       

Provided that the party who suffers such breach shall not be entitled to recover the expenses and costs under sub-section (1) unless he has got the contract performed through a third party or by his own agency.

(3) Where the party suffering breach of contract has got the contract performed through a third party or by his own agency after giving notice under sub-section(1), he shall not be entitled to claim relief of specific performance against the party in breach.

(4) Nothing in this section shall prevent the party who has suffered breach of contract from claiming compensation from the party in breach.

No substituted performance without notice to the wrongdoer party [Section 20(2)]-

The affected party cannot undertake substituted performance of contract unless he gives a notice in writing to the wrongdoer party who has made a breach of contract of not less than thirty days, calling upon him to perform the contract within such time as specified in the notice. However, on his refusal or failure to do so, the affected party may get the same performed by a third party or by his own agency.

Cost or expenses can be claimed after substituted performance of the contract- It is important to note that the party who suffers such breach shall not be entitled to recover the expenses and costs unless he has got the contract performed through a third party or by his own agency.

No specific relief when there is substituted performance [Section 20(3)]- Where the party suffering breach of contract has got the contract performed through a third party or by his agency after giving notice he shall not be entitled to claim relief of specific performance against the party in breach.

Substituted performance and compensation [Section 20(4)]- Section 20 shall not prevent the party who has suffered breach of contract from claiming compensation from the party in breach.

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