62. Effect of novation, rescission, and alteration of contract.- If the parties to a contract agree to substitute a new contract for it, or to rescind or alter it, the original contract need not be performed. Illustrations
A owes money to B under a contract. It is agreed between A, B and C that B shall thenceforth accept C as his debtor, instead of A. The old debt of A to B is at an end, and a new debt from C to B has been contracted.
A owes B 10, 000 rupees. A enters into an arrangement with B, and gives B a mortgage of his (A' s) estate for 5, 000 rupees in place of the debt of 10, 000 rupees. This is a new contract and extinguishes the old.
A owes B 1, 000 rupees under a contract. B owes C 1, 000 rupees. B orders A to credit C with 1, 000 rupees in his books, but C does not assent to the arrangement. B still owes C 1, 000 rupees, and no new contract has been entered into.