Section 37 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 37 opens Chapter IV on the performance of contracts. It says that each party must either perform or offer to perform what it promised, unless performance is dispensed with or excused, and that a promise generally binds the promisor's representatives if the promisor dies before performing. If you are drafting service or supply terms, a good service agreement should spell out who performs, by when, and what happens on death or default.
The parties to a contract must either perform, or offer to perform, their respective promises, unless performance is dispensed with or excused under the Act or any other law. If a promisor dies before performance, the promise binds the promisor's representatives, unless a contrary intention appears from the contract. The Act's own illustrations show the difference between a promise to deliver goods (binds the estate) and a promise to paint a picture (cannot be enforced by or against the estate).
What the first paragraph says
The text reads: "The parties to a contract must either perform, or offer to perform, their respective promises, unless such performance is dispensed with or excused under the provisions of this Act, or of any other law."
Take the limbs one at a time.
- "Must either perform, or offer to perform." The obligation is not only to perform. A party who has done what the contract requires of it by making a proper offer of performance has also met the section. What makes an offer a proper one is dealt with in section 38; see sections 38 and 39.
- "Their respective promises." Each party is bound by its own promise. In a two-sided contract both sides have promises, so both sides have this duty.
- "Dispensed with or excused." Two different ideas. A promise may be dispensed with (for example, the promisee agrees to let it go) or excused (for example, performance becomes impossible). The section says this happens "under the provisions of this Act, or of any other law". The text of section 37 does not list them. The provisions of this Act that deal with such cases include section 56 (impossibility), sections 62 to 67 (novation, rescission, remission and related rules) and section 38 (a refused offer of performance).
What the second paragraph says
"Promises bind the representatives of the promisors in case of the death of such promisors before performance, unless a contrary intention appears from the contract."
This is a default rule with a built-in exception. If the promisor dies, the contract does not simply end. Unless the contract shows a contrary intention, the promisor's representatives are bound. The section does not define "representatives" and does not describe how an estate is administered; it only states the rule.
The Act's own illustrations
| Illustration | Facts (in plain words) | Result under the Act |
|---|---|---|
| (a) | A promises to deliver goods to B on a certain day on payment of Rs. 1,000. A dies before that day. | A's representatives are bound to deliver the goods, and B is bound to pay the Rs. 1,000 to A's representatives. |
| (b) | A promises to paint a picture for B by a certain day, at a certain price. A dies before the day. | The contract cannot be enforced either by A's representatives or by B. |
The contrast is the point. In (a) the work can be done by someone else, so the promise survives. In (b) the promise is personal to the painter. The reason ties to section 40, which says a promise must be performed by the promisor himself where that was the parties' intention; see sections 40 and 41.
A modern example (ours, not the Act's)
Meera Traders agrees to supply 500 office chairs to Kavi Interiors by 30 November at an agreed price. The proprietor of Meera Traders, Meera, dies on 20 November. Because nothing in the contract shows a contrary intention, the promise to deliver binds her representatives, and Kavi Interiors remains bound to pay on delivery. If instead the contract were for Meera personally to design a custom mural, the nature of the work would point the other way, as in the Act's picture illustration.
What can the parties change?
Only the second paragraph carries the words "unless a contrary intention appears from the contract". So a contract can provide that it ends on the promisor's death, or that the representatives are not bound. A well-drafted contract usually says one or the other. The first paragraph does not use those words; it makes its own exceptions through "dispensed with or excused" under the Act or other laws. What the parties may agree to dispense with is taken up in sections 62 and 63; see section 62.
Practical points
- Say who performs. If the work depends on a named individual's skill, state so. If any competent person may do it, state that too.
- Add a death or incapacity clause. State whether the contract continues, terminates, or can be assigned to a replacement.
- Keep proof of performance or tender. Since an offer to perform counts, keep written records of delivery attempts, emails and call logs.
- Check other laws. Section 37 refers to excuse "under ... any other law". The text does not name those laws, so read the statute relevant to your transaction.
- Understand the overview. For the wider picture of how offer, acceptance and performance connect, see the introduction to the Indian Contract Act.
Need help with performance obligations?
If your contract is silent on who performs and what happens when the promisor dies or cannot continue, it is worth tightening before a dispute arises. Our service agreement drafting team can set out the performance duties, the personal-service and delegation terms and the death clause in plain language. A short review of your current draft is usually enough to find the gaps.
Key takeaways
- Each party must perform or offer to perform its own promise (s.37, first paragraph).
- Performance can be dispensed with or excused under this Act or any other law.
- A promise binds the promisor's representatives on death before performance, unless a contrary intention appears from the contract.
- The Act's illustrations contrast goods delivery (binds the estate) with a personal picture-painting promise (cannot be enforced either way).
- A clear clause on death and substitution avoids argument later.
Read next
- Sections 38 and 39: tender of performance and refusal to perform wholly
- Sections 40 and 41: who must perform and performance by a third person
- Sections 34 to 36: contingent on future conduct, fixed time and impossible events
- Introduction to the Indian Contract Act, 1872
Disclaimer: Based on the text of the Indian Contract Act, 1872 as consulted on 1 October 2026. Many questions under this Act turn on case law and on the wording of the particular contract, which this article does not cover. It is general information, not legal advice; check the official text and take advice before acting.