Reduction in Price

If a party is willing to accept a defective performance, they are entitled to a price reduction. A price may be reduced when the other party had a chance to rectify the defect but did not do so. The price reduction balances the effects of the defect and the contract remains in force unchanged in other respects.

The defect need not be fundamental and even a small defect can entitle to a reduction in the price. However, the defect must have affected the price or another condition of the agreement.

The price reduction is possible in various cases according to many legal provisions. For example, the Sale of Goods Act includes provisions of the price reduction.