What is the term for discharging a contract when both parties agree not to proceed?

Mutual rescission is the correct term for discharging a contract when both parties agree not to proceed. This legal concept implies that both parties have voluntarily decided to release each other from their contractual obligations, effectively nullifying the agreement as if it never existed. This can occur in situations where, for example, both parties find that the contract is no longer necessary or that they have reached a new understanding that invalidates the original terms.

In contrast, discharge by novation involves replacing an existing contract with a new one, where at least one party is substituted. Discharge by accord and satisfaction refers to an agreement where one party agrees to accept a different performance than what was originally promised in the contract to satisfy the obligation. Termination for convenience allows one party to terminate the contract without cause, often under specific conditions outlined within the contract itself. Each of these alternatives represents a different approach to ending a contractual relationship, but mutual rescission specifically emphasizes the joint agreement of both parties to void the contract.