Frustration

• Discharge by frustration is where a party to a contract was prevented from keeping the promise because of an unforeseeable, intervening event, they are not liable for the breach (Taylor).
• For frustration to be present, the court must decide whether performance is impossible in fact (Jackson).
• A contract becoming illegal to perform after it is made frustrates the contract (Denny, Mott and Dickson Ltd).
• The main purpose of the contract must be affected by the change, not just some aspect of it (Krell/ Herne Bay Steamboat Co.)
• Self induced frustration is breach and frustration will not apply if the frustrating event is in control of one party (Maritime National Fish Ltd).
• A contract becoming less profitable or more difficult to complete is not a reason for frustration (Davis Contractors).
• If the event is a foreseeable risk and is mentioned in the contract, it cannot be frustration (Armchair Answercall).
• Remedies include:

  • money already paid is recoverable
  • money due is not payable
  • compensation for work done and expenses