FRUSTRATION

Question 1

What is a frustrating event in contract law? (1)

Answer 1

An event that may discharge (end) the contract

There are three types of frustrating events: impossibility of performance, a radical change in circumstances, and illegality of the contract.

Question 2

Name the three types of frustrating events. (2)

Answer 2

• Impossibility of performance
• Radical change in circumstances
• Illegality of the contract

Each type can lead to the discharge of a contract under specific conditions.

Question 3

What does impossibility of performance entail? (3)

Answer 3

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 performance is possible just more difficult or expensive than anticipated (Davis v Fareham, Tsakiroglou v Noblee
Thorl).

Question 4

True or false: A contract is frustrated if performance is just more difficult or expensive than anticipated. (4)

Answer 4

FALSE

Cases like Davis v Fareham and Tsakiroglou v Noblee Thorl illustrate that mere difficulty or expense does not constitute frustration.

Question 5

What constitutes a radical change in circumstances? (5)

Answer 5

A change that relates to a main purpose of the contract

The case **Krell v Henry **exemplifies this, where the main purpose (the show) was cancelled. The change must be sufficiently radical (Herne Bay v Hutton).

Question 6

What is an example of illegality of the contract? (6)

Answer 6

A change in the law makes the contract illegal to perform

The case Shipton Anderson and Denny v James Fraser illustrate this situation.

Question 7

What happens under Section 1(2) of the Law Reform (Frustrated Contracts) Act 1943? (7)

Answer 7

Money paid before the frustrating event is recoverable, minus just expenses (Gamerco v ICM)

This applies to situations where goods ordered are cancelled due to new legislation.

Question 8

Under Section 1(3), what must happen if no money has been paid in advance? (8)

Answer 8

The value of any benefit gained must be paid back to the other party

The judge will assess this as seen in Hunt v BP.

Question 9

True or false: Frustration applies if the event is self-induced. (9)

Answer 9

FALSE

The case Maritime National Fish v Ocean Trawlers shows that self-induced events do not qualify for frustration.

Question 10

What is a foreseeable risk in the context of frustrating events? (10)

Answer 10

An event that was anticipated and could have been avoided

The case John Walker and**Sons **illustrates that if the risk was foreseeable, frustration does not apply.