Contract Law Second Term - FRUSTRATION Flashcards
What are the three circumstances in which frustration is used?
Performance is illegal, physically impossible or requires something radically different
‘No excuses’
Paradine v Jane
Paradine v Jane
‘No excuses’; enemy invasion
Taylor v Caldwell
Music hall
How did they invoked frustration in Taylor v Caldwell?
Implied term if subject ceases to exist then no contract
What Act could Taylor v Caldwell now try and claim under?
LR(FC)A 1943
Jackson v The Union Marine
6 months stranded; ‘would have been a different voyage’
What are the three issues with implied term in Taylor?
How can unforeseen events be implied, does not consider all terms that would have been implied and courts still frustrate even with FM clauses
James Scott v R & N
Tiger and milk girl
Denny, Mott v James B Fraser
‘Reservations’ parties would have made etc are not implied in as terms
Ertel Bieber v Rio Tinto on FM clauses
Still frustrate contract even with FM
Ertel Bieber v Rio Tinto on legal impossibility
Cannot exclude doctrine of F by express term for subsequent illegality
Who gave that the test is that the outcome is something ‘radically different’?
Lord Radcliffe in Davis Contractors v Fareham Urban DC
What did the court refuse to recognise in Davis Contractors v Fareham UDC?
Commercial impracticability
Fibrosa Spolka v Fairbairn
Illegal due to war
Baily v De Crespigny
Acquisition of land by state
Metropolitan Water Board v Dick Kerr
Reservoir, ministry; ‘substitute a different contract’
Cricklewood Property v Leighton’s Investment
99 years, restriction left 90 so not radically different
What are the three sub-categories of physical impossibility?
Death/incapacity, destruction of subject matter and delay/hardship
Marshall v Harland
Test for sufficient incapacity: ‘impossible’ or ‘radically different’ performance
FC Shepherd v Jerrom
Prison
Notcutt v Universal Equipment
Heart-attack; void
Phillips v Alhambra
Proprietor died; others could perform
Name two cases where subject matter was destroyed
Taylor v Caldwell; Appleby v Myers; Asfar v Blundell; Jackson v The Union Marine
Asfar v Blundell
Dates submerged; partial but substantially different
Jackson v The Union Marine on destruction of subject
6 months stranded; ‘practical commercial destruction’
Davis Contractors on delay and hardship
‘More onerous’ but not of a ‘different kind’
Jackson v The Union Marine on delay and hardship
Time of the essence; ‘with all possible dispatch’
The Eugenia
Suez canal
Why was the delay not sufficient in The Eugenia?
108 - 128 and not of the essence.
Two cases on impossibility of purpose
Krell v Henry; Herne Bay Steamboat v Hutton
Krell v Henry
Coronation
Herne Bay Steamboat v Hutton
Pleasureboats
What are contractual interpretations for in frustration?
To see if either party made provision
What are the two ways to interpret provision in contracts for frustration?
Express terms or implied allocation
Metropolitan Water Board on express term for F
Delay did not apply as ‘so abnormal’ it fell outside what parties could have ‘possibly contemplated’
What case shows implied allocation of risk for F?
WJ Tatem v Gamboa
WJ Tatem v Gamboa
Civil war refugee ship
What was the implied allocation in WJ Tatem?
Highly foreseeable so allocated to performing party
What was frustrating in WJ Tatem?
Length of seizure rather than seizure itself
To prove fault in F, who is the onus on?
Onus on C to show D brought it about
The Eugenia on fault
Charterers in BoC by entering war zone
The SS2
Drilling rig, self-induced
Jerrom on anticipatory breach and fault
Person at fault cannot rely on doctrine of F
Maritime National v Ocean Trawlers
Five licences
Chandler v Webster
Coronation, £100 and £41
Fibrosa Spolka v Fairbairn
Occupation; ‘total failure of consideration’
What was the ‘quasi-contractual’ claim in Fibrosa?
For unjust enrichment
What section is money covered in LR(FC)A?
S.1(2)
What section are non-money benefits covered in LR(FC)A?
S.1(3)
Lobb v Vasey
Under s.1(2) onus on D to show ‘just’
Gamerco v ICM/Fair Warning
Guns and roses
Which case highlighted three possibilities for deciding expenses under s.1(2)?
Gamerco v ICM/Fair Warning
BP Exploration (Libya) v Hunt (No.2)
Oil concession
What were the two stages in BP?
What benefit was conferred? £85 mil (end product minus expropriation) Just award to BP in light of expenses? £35 mil (contract price)
What case is not solved by s.1(3)?
Appleby v Myers
Why is Appleby v Myers not solved by s.1(3)?
‘Valuable benefit’ = ‘end product’, but no end product.
Who criticised s.1(3) for taking an end-product analysis?
McKendrick, “Frustration, Restitution and Loss Apportionment”
What arguments in favour of loss apportionment does McKendrick give?
Economically sounder and ‘one of the parties has to suffer loss for which neither is responsible’ (Bingham, SS2)
Who said ‘grave deficiencies’ are still there in LR(FC)A?
McKendrick
