Frustration

Question 1

What is frustration

Answer 1

allows parties of a contract to be released from their future obligations on the basis that performance has become impossible.

Question 2

PK multifactorial approach to frustration

Answer 2

• Terms
• Contracts context
• Parties’ knowledge, expectation, assumptions, contemplation particular as to risk at time of contract
• Nature of supervening event
• Parties’ reasonable calculations as to possibility of future performance in new circumstances

Question 3

Davis test cited in PK

Answer 3

occurs where performance of obligations is impossible because the circumstances are radically differece (Davis). If part performance is still possible, no frustation

Question 4

Common situation: unattainability of a person or thing

Answer 4

Taylor v Caldwell: Fire burns down music hall hire for concert

Question 5

Common situation: unattainability of purpose

Answer 5

Krell v Henry: Krell rented out apartment at a high rate to which coronation (other party was aware of this purpose). Coronation cancelled, contract repudiated

Question 6

Self induced

Answer 6

Maritime National Fish v Ocean Trawlers: M hired boat from OT. M has 5 boats total and only was granted 3 licenses. M decided not to use one of those license on OT’s boat and tried to claim frustration because they could not license the boat, which was not available as they could have chosen to license that boat but they didn’t

Question 6

Common situation: Supervening illegality

Answer 6

Rayneon v Frazer: F was dentist, hired a sign to advertise business from R. During the hire, govt. made dentist sign illegal if it didn’t meet requirements. Contract frustrated. Rayneon kept the money paid by Frazer when the sign was legal (s 63 CCLA sum must be recovered if party obtained valuable benefit)

Question 7

When can frustration not be claimed

Answer 7

Self induced, more expensive or more difficult

Question 7

More difficult

Answer 7

Davis Contractors: builders took longer than expected building a house, no frustration

Question 8

More expensive

Answer 8

Peanut Case: T agreed to ship peanuts by a certain date. Main canal the ship used was blocked requiring them to make a dangerous trip around Africa which was 4x more expensive. No frustration as even though it was 4x more expensive to take the other route it was still possible for the peanuts to be delivered in time

Question 8

Effect of frustration

Answer 8

CCLA: sections