Rescission vs Repudiation in Contract Law

In contract law, rescission and repudiation are two distinct concepts that refer to the termination of a contract.

Rescission refers to the act of undoing or cancelling a contract and restoring the parties to their original positions as if the contract never existed. This can be done either by mutual agreement of the parties or through a court order. Rescission is typically sought when one of the parties has made a mistake, there has been fraud, misrepresentation, or duress involved in the formation of the contract, or if the terms of the contract are illegal or unenforceable.

Repudiation, on the other hand, refers to a party's declaration that they do not intend to fulfil their obligations under a contract. This can occur before or after performance is due, and can be a complete refusal to perform or a refusal to perform in accordance with the terms of the contract. Repudiation gives the other party the option to either sue for breach of contract or to treat the contract as discharged and sue for damages.

In summary, rescission is a legal remedy that cancels a contract, while repudiation is a breach of contract where one party declares their unwillingness to perform their obligations under the contract.

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