Fustration Flashcards
What is the intro for frustration?
A frustrating event before the contract is complete may end in a discharge (end) the contract.There are 3 types of frustrating event.
What is the impossibility of performance?
Impossibility of performance where it is impossible for the contract to be completed (Nichol and Knight v Ashton Eldridge,Taylor v Caldwell).this will not apply if the performance is possible just more difficult or expensive than anticipated (Davis v Fareham, Tsakiroglou v Noblee Thorl).
What constitutes a radical change in circumstances for contract frustration?
A radical change in circumstances occurs if the change relates to a main purpose of the contract (Krell v Henry). The change must be sufficiently radical (Herne Bay v Hutton).
What is an example of a radical change in circumstances?
The cancellation of the main purpose of the contract, such as a show, is a sufficiently radical change in circumstances, leading to frustration of the contract.
What happens if performance of a contract becomes illegal?
If the government changes the law on drugs after the contract is made, making performance illegal, the contract is frustrated.
What are some specific situations where frustration may be considered?
Frustration may be considered in leases (National Carriers v Panalpina) and contracts of employment (Robinson v Davidson).
What is an example of frustration in a lease situation?
In a lease situation, if the special kind of fuel required for a car is unavailable for 2 months, the lease contract may still be enforceable.
What is an example of frustration in a contract of employment?
If an employee is instructed not to sing for 6 months, the contract of employment may be frustrated.
When will frustration not apply?
Frustration will not apply if it is self-induced, meaning it is the fault of one of the parties (Maritime National Fish v Ocean Trawlers) or if there was a foreseeable risk of the frustrating event occurring (John Walker and Sons).
What is an example of a non-frustrating event?
If the venue burns down due to the claimant’s actions, the contract is not frustrated.
What happens to money paid before a frustrating event?
Under Section 1(2) of the Law Reform (Frustrated Contracts) Act 1943, money paid before the frustrating event is recoverable, minus the other party’s ‘just’ expenses (Gamerco v ICM).
What is an example of money recoverable under the Law Reform (Frustrated Contracts) Act?
Paying in advance for goods and then having the order cancelled due to new legislation prohibiting those goods is an example.
What happens under Section 1(3) if no money has been paid in advance?
The value of any benefit gained by one party must be paid back to the other party. The judge will assess this (Hunt v BP).
When can damages be awarded in the context of no money paid?
Damages may be awarded if one party attracted more customers to their business due to another party’s actions.
Example: If X attracted more customers to his pub because of Y’s band, the court may award damages which reflect the increase in custom for X.
