Discharge Bu Frustration

Question 1

What are the 5 elements of discharge by frustration

Answer 1

1) No frustration if self induced
2) no frustration is less profitable
3) no frustration if foreseeable
4) force majeure clause
5) remedies

Question 2

What is self induced

Answer 2

No discharge by frustration if frustration is self induced
(Maritime National Fishing v Ocean Trawlers)

Question 3

What is less profitable

Answer 3

No discharge by frustration when a contract becomes less profitable or commercially difficult (The Suez Canal)

Question 4

What is foreseeable risk

Answer 4

No discharge by frustration when the event is a foreseeable risk or mentioned in the contract (Armchair Answercall v People In Mind)

Question 5

What is a force majeure clause

Answer 5

Frustration can’t be relied on where there is a force majeure clause which states what must be done if a contract is frustrated

Question 6

What are the 3 remedies

Answer 6

1) contract is automatically terminated and releases parties from further performance
2) Law Reform Frustrated Contracts Act 1943 under s.1(2) - money already paid or owed before event can be claimed back
3) under s.1(3) - party may recover any valuable benefit before the frustrating event