Frustration

Question 1

Paradine v Jane (1647)

Answer 1

At common law, if a party has agreed to perform a contract, they must do so regardless of unforeseen events — no excuse was accepted for non-performance, including war, natural disasters, or destruction of subject matter.

Question 2

Davis Contractors

Answer 2

Difficulty of performance is not grounds for frustration. without default of either party, contractual obligation has become incapable of being performed; this causes circumstances which render a performance radically different from what was undertaken by the contract - Lord Radcliffe

Question 2

Taylor v Caldwell

Answer 2

destruction of subject matter as the music hall burnt down.

Question 2

Fibrosa

Answer 2

paying party is entitled to recover the amount when no consideration has been provided

Question 3

Condor v Barron Knights

Answer 3

condors inability to perform was a core element hence personal incapacity rendered the contract frustrated

Question 3

Goldgroup properties

Answer 3

foreseeable and covered in the contract. property market crash is foreseeable and renegotiable

Question 3

Krell v Henry

Answer 3

The core element of the contract did not take place which is why it was frustrated. Henry had paid a deposit, but the contract was later held to be frustrated due to the coronation’s cancellation.
Despite frustration, he could not recover the deposit because there had not been a total failure of consideration under common law principles at the time.
Law Reform (Frustrated Contracts) Act 1943, Section 1(2), allows recovery of money paid, subject to deductions for reasonable expenses.

Question 3

Gamerco

Answer 3

when a contract is frustrated, one party may already have gained a valuable benefit money paid or payable is allowed to be compensated due to equity

Question 4

Maritime National Fish

Answer 4

self induced by using the acquired fishing licenses on their own boats

Question 5

hyrne bay v hutton

Answer 5

frustrated if the core element of the contract changes

Question 6

BP exploration

Answer 6

prevented unjust enrichment by allowing for compensation to BP for the oil compounds

Question 7

Chandler v webster

Answer 7

Under common law, before the Frustrated Contracts Act 1943, when a contract was frustrated:

Money already paid could not be recovered.

Money due before frustration was still payable.

Essentially, the risk lay with the payer, and no restitution was available unless there was total failure of consideration (later reconsidered in Fibrosa [1943]).

Overturned in spirit by:
Fibrosa Spolka v Fairbairn [1943] – introduced the idea of total failure of consideration.

Law Reform (Frustrated Contracts) Act 1943, Section 1(2) – now allows money paid to be recovered and money due to be cancelled, subject to fairness and expenses.