What does discharge by performance entail?

Discharge by performance involves fulfilling all contractual duties as specified in the agreement between the parties involved. When both parties complete their obligations as outlined in the contract, this results in the termination of the contract. This type of discharge signifies that the commitments have been met to the satisfaction of both parties, thereby releasing them from any further responsibilities under that contract.

In contrast, ending a contract due to mutual agreement refers to a different mechanism where both parties willingly decide to terminate the contract without fulfilling the terms. Inability to perform due to external factors speaks to circumstances such as force majeure that prevent performance but does not equate to discharging the contract through actual performance. Offering compensation instead of service represents a situation where one party seeks to fulfill obligations by providing payment rather than performing the contract terms, which also does not qualify as discharge by performance. Hence, the essence of discharge by performance lies in the actual execution of the duties outlined in the contract.