What is the term for the substitution of parties in a contract?

The correct term for the substitution of parties in a contract is "novation." This legal principle involves the replacement of one of the parties in an agreement with the consent of all parties involved, thereby creating a new contract that extinguishes the original contract with respect to the substituted party.

In essence, novation requires a new party to assume the rights and obligations of an original party, and all parties must agree to this change. This is crucial in maintaining the integrity of the contractual relationship, as it ensures that all parties understand and accept the updated terms and obligations.

Other options represent different legal concepts. For instance, "accord and satisfaction" refers to an agreement to accept a different performance than originally stipulated in a contract, rather than substituting a party. "Assignment" typically involves transferring rights under a contract to another party without necessarily changing the original parties involved. "Termination" refers to the cancellation of a contract, ending the agreement between the current parties, rather than substituting one with another. Each of these terms addresses different aspects of contract law, but novation specifically pertains to the substitution of parties.