Frustration Flashcards
What is frustration
An event that makes the performance radically different from what was originally agreed by the parties
When must the event have happened
After contract was made
Causes of frustration
Illegal
Impossible
Radical change in circumstances
Impossible case
Taylor V Caldwell
What is impossible
If completing contract is now impossible due to event frustration
What if contract is illegal from start
Void
Frustration will not apply
Illegal case
Denny mott V James Fraser
Radical change in circumstances case
Krell V Henry
What is radical change in circumstances
If main purpose of contract is based on event that cannot take place
Employment contracts
Frustrating event can be inability of party
Employment contract case illness
Robinson V Davidson- illness
Where will frustration not apply
Slef induced
Less profitable
Event was foreseeable or event was mentioned in contract
Lack of profit
Lack of profit is not radical change in circumstances
Davis V fareham
Self induced explain
Frustration will not apply when frustrating event is within control of one party
Slef induced case
Maritime national fish V ocean trawlers
Foreseeable
Armchair answercall V people in mind
Parties could not reasonably foresee or be a real possibility
Foreseeable- aware of risk
Amalgamated investment and property V John walker and sons
Cannot be aware of risk
Frustration case
Paradine V Jane
Frustration remedies act
Frustrated contract act 1943
Sections
1.2
1.3
1.4
1.2
Money paid before event is recoverable
When frustrated no obligation to pay for agreed service or goods
Court can award part expenses incurred for sum paid or payable
1.3
If part obtained benefit then court can order them to pay sum as compensation
1.4
When estimating expenses courts consider
Overhead costs
Work or services already provided
What is amount calculated on
Quantum merit basis - fair and reasonable
Summary
Money paid is recoverable
Money due is not payable
Can order compensation for benefit
Compensation can be paid for work done and expenses
Medical advice - can frustrate
Condor V baron knights
- medical advice
Force majeure clause
Excludes liability for extraordinary events that are outside control or contemplation of parties
NOT IMPLIED