Contract 9 - Discharge - Frustration

Question 1

What is frustration and what’s its effect?
😰

Answer 1

Events:

• that occur after formation of the contract, and 🕰️
• are beyond control of either party 🧟‍♂️ and
• render performance radically different 🐴➡️🦄

Effect: relieves a party from further obligations under the contract - contract ends automatically 😮‍💨

Question 2

How may performance be rendered radically different?
🐴➡️🦄

Answer 2

Performance is
- impossible, 🪄
- unavailable 🫥
- illegal 👮
- common purpose is frustrated i.e. can’t be carried out 👯‍♀️😭

Question 3

What is not a frustrating event?

Answer 3

• Merely an increase in expense/onerousness 💰💰💰😩
• One which parties could’ve reasonably foreseen 🧐
• Provided for in the contract i.e. force majeure clause 📝
• Caused by party’s default 😈

Question 4

What happens to obligations arising to frustrating event?

Answer 4

• Money paid before can be recovered & money that should’ve been paid no longer need to be ⏳💵
• Expenses of payee can be recovered at discretion of the court 🧑‍⚖️💵
• Where benefit was non-monetary, a party who received it may be required to pay a just sum for it 🎁🏠⚖️💵

Question 5

What is the case on acceptance of partial performance?

Answer 5

👷

Builder went broke halfway through project.

• No payment for part completed building as C couldn’t reject. 🏠
• Payment for building materials left on land s could have returned 🧱

Question 6

What is Wrongful prevention of performance and what are the remedies
😈

Answer 6

Party prevented from completing work due to fault of other party.
- sue for damages 💵
OR
- claim quantum meruit 🧱💵

Question 7

What are the cases on frustration?
Impossibility 🪄
Unavailability 🫥
Illegality 👮

Answer 7

🪄
- Music hall destroyed=frustrated 🎼💥
- Install Machinery in a factory but factory destroyed=frustrated ⚙️🏭💥
🫥
- Ill drummer=frustrated 🥁🤮
- ship requisitioned 5 months = frustrated 🚢🇮🇴 but 5 years not (it’ll be done soon).
👮
- war made deliveries to Poland illegal 🚢🇵🇱❌

Question 8

What are the cases on frustration of common Purpose?
👯‍♀️😭

Answer 8

Must be purpose of both parties

• Hired room to watch coronation that was cancelled = frustration
  👑🤮😢
• hired boat to watch Navy show which was cancelled. Still have a boat = not frustrated 🛥️🚢❌
• lease of office no longer needed due to brexit = not frustrated 🏢🇪🇺💥❌

Question 9

What are the cases on frustration
- Difficult or expensive? 💰💰💰😭
- Self-induced 🤪
- Foreseeable 🧐

Answer 9

💰💰💰😭
- Built houses cost more than expected = not frustrated 🏘️💰😭
🤪
- rig moving boat 1 sunk, rig boat 2 leased = not frustrated as choice to lease rig boat 2 🚢❌🚢✅😭
🧐
- Contract signed during civil unrest, got worse = not frustrated as foreseeable
🇬🇷🎼🔥➡️💥❌
- No frustration of force majeure clause in contract.

Question 10

What are the consequences of frustration?

Answer 10

• money paid before event can be recovered 💵💥😊
• money should have been paid before frustrating event need not be paid 🤑💥😊
• expenses by supplier can be recovered out of sums paid/payable before event👷‍♂️🧱💷
• all future obligations cancelled 🔮😮‍💨

Question 11

What’s the case on the amount of expenses payable to the supplier and frustration?

Answer 11

Value of benefit payable to supplier is benefit received NOT costs of supplier

Libyan Oilfield case
😊BP🛢️👨‍🔬 🏗️🧔🏽‍♂️😭😢
-🛢️👨‍🔬 ❌
- 😢 ✅