Fustration

Question 1

Define Fustration

Answer 1

• An unforeseen event that makes contractual performance, impossible, illegal, or radically different from that comtemplated, through no party’s fault

Question 2

How does it differ from a Breach

Answer 2

• No one is actually at fault

Question 3

Consequence of Fustration

Answer 3

Contract Discharged. Under Law Reform (Frustrated Contracts) Act 1943, parties nat recover money paid or expenses incurred before the frustrating event.

Question 4

What was the Key Rule Change in Frustration and the two cases that establish this.

Answer 4

Old Rule: Paradine v Jane - Even if an external event made performance impossible
Modern Law: Taylor v Caldwell - Music hall burnt down before contract. Contract was frustrated, impossible to perform due to destruction of subject matter.

Question 5

What are the three key elements where one must be established for Frustration

Answer 5

• Impossibility
• Illegality
• Radical Change in Circumstance

Question 6

Explain Impossibility and give two cases

Answer 6

• Performance is physically or practically impossible.
• Taylor v Caldwell: Halldestroyed, concerts couldnt happen
• Condor v The Barron Knights: Drummer became ill and couldnt perform full-time, contract fustrated

Question 7

Explain Illegality and give a case

Answer 7

• A new law makes performance illegal
• Denny, Mott & Dickinson v James Fraser: Timber sale became illegal due to wartime legislation, Contract Frustrated.

Question 8

Explain Radical Change in Circumstances and give two cases

Answer 8

• Contract becomes totally different from what was agreed
• Krell v Henry: room rented to watch King’s coronation. Coronation cancelled. Frustrated, as the event was the contract’s foundation.
• Herne Bay Steam Boat v Hutton: King didnt attend, but fleet still viewable. Not Frustrated as main purpose still possible.

Question 9

What are the different Limitations on Frustration

Answer 9

• Event was foreseeable
• Frustration is self induced
• Performance is just more expensive/difficult

Question 10

Explain Event was foreseeable by using a case

Answer 10

• AIP v John v Walker: Whisky supplier argued that government price frustrated the contract. The risk of price changes was forseeable and had been discussed. No Frustration

Question 11

Explain Frustration is self induced by using a case

Answer 11

• Maritime National Fish v Ocean Trawlers: Company chose to use licenses on other boats, not the one in the contract. No Frustration. They caused the problem.

Question 12

Explain Performance is just more expensive/difficult using a case

Answer 12

• More Expensive or Difficult = Still Performable
• Davis Contractors Ltd v Fareham UDC: Builders took much longer due to labour shortages and rising costs. No Frustration they agreed to build the houses and still could.