Introduction
● General rule in Pardine v Jane. Strict liability, contractual obligations are absolute, i.e a
party must perform his contractual obligations. If he does not he will generally be in
breach of contract. This was harsh and needed modification
● Frustration is an exception to this. Dates from the decision in Taylor v Caldwell A music
hall was destroyed by fire and concerts could not take place. Neither party was at fault.
Said to be an implied term in the contract that the parties would be excused if
performance became impossible in the case of a fire. The above was dismissed in Davis
Contractors v Fareham Urban District Council: the meaning of the contract must be
taken to be, not what the parties did intend, but that which the parties as fair and
reasonable men would presumably have agreed upon if having such possibility in view.
● Define frustration: A contract may be frustrated if an unforeseen, supervening event
occurs after the contract has been formed which was not the fault of either party and
which makes the contract impossible or radically different to perform.
Possible things to include in main body:
what events/circumstances amount to frusration
● Unavailability of a specific thing or person vital to the contract - In Taylor v Caldwell
(specific thing) Morgan v Manser (person unavailable altogether) Condor v Barron
Knights (drummer not capable of performing the contract in the way intended
● Non-occurance of a fundamental event - in Krell v Henry the contract was frustrated by
the cancellation of the coronation.
● Ilegality: it is against the law to trade with the enemy during war (Fibrosa)
● Government intervention/delay:
● (Metropolitan Water Board v Dick Kerr) the outbreak of war meant the government
ordered the work to stop which frustrated the contract. There was a clause in the
contract dealing with the possibility of an extension of time in the case of delay but the
court decided it was meant to cover temporary delays and not an interruption of such
character and duration that it fundamentally changed the contract.
● HOWEVER In Tsakiroglou the closure of the suez canal meant that goods had to be
shipped a different way. This did not frustrate the contract because even though the
contract had become more difficult and expensive, it could still be performed.
● David Contractors v Fareham Urban District council: the contract was not frustrated
after the contractors experienced a number of difficulties caused by shortages of labour
and materials. ‘It is not hardship or inconvenience of material loss which brings the
principle of frustration into play...There must also be such a change in the significance of
the obligation that the thing undertaken would, if performed, be a different thing from that
contracted.’ Also in this case the parties could have foreseen the cause of delay.
● Critical evaluation point: If more claims are allowed in regards to delay it would open
the floodgates. Some contractors might underestimate the cost of their work and it would
be unreasonable if they could say the contract was at an end.
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