In which scenario would a contract be discharged by mutual assent?

• A. One party refuses to fulfill the terms of the contract
• B. Two parties come to an agreement to end the contract
• C. A party sells their interest in the contract to a third party
• D. The contract is automatically terminated after a set period

Answer: (B)

A contract is discharged by mutual assent when both parties voluntarily agree to terminate the contract. This agreement to end the contract can occur for various reasons, such as changes in circumstances or a mutual decision that fulfilling the contract is unnecessary or undesirable. In this case, both parties must express their consent to end the contract, which constitutes mutual assent.

The other scenarios do not involve mutual agreement between the parties. For instance, if one party refuses to fulfill the terms of the contract, it typically leads to a breach rather than a mutual termination. Selling one's interest in the contract to a third party involves a transfer rather than an agreement to dissolve the original contract. Furthermore, automatic termination after a set period does not involve the assent of both parties, as it is based on a predetermined condition rather than a mutual decision. Thus, option B accurately reflects the concept of mutual assent in the context of contract law.