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Test/Elements of Frustration: Is the party at fault. PowerPoint Presentation
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Test/Elements of Frustration: Is the party at fault. Is there a radical change in the contractual obligation in respect of which no prior agreement has been reached? Was the supervening event, from which the radical change in obligation is arising from, unforeseeable?.

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slide1

Test/Elements of Frustration:

Is the party at fault.

Is there a radical change in the contractual obligation in respect of which no prior agreement has been reached?

Was the supervening event, from which the radical change in obligation is arising from, unforeseeable?

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Paradinev. Jane(1647) 82 E.R. 897

…[W]here the law creates a duty or charge, and the party is disabled to perform it without any default in him, and hath no remedy over, there the law will excuse him

…[B]ut when the party by his own contract creates a duty or charge upon himself, he is bound to make it good, if he may, notwithstanding any accident by inevitable necessity, because he might have provided against it by his contract

(Another reason was added, that as) the lessee is to have the advantage of casual profits, so he must run the hazard of causal losses, and not lay the whole burthen of them upon his lessor

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Taylor v. Caldwell

(1863) 3 B & S 826

Where there is a positive (and absolute and not subject to any condition either express or implied) contract to do a thing, not in itself unlawful the contractor must perform it or pay damages for not doing it, although in consequence of unforeseen accidents, the performance of this contract has become unexpectedly burthensome or even impossible.

In the absence of any express or implied warrant that the thing shall exist, the contract is not to be construed as a positive contract, but as subject to an implied condition that the parties shall be excused in case, before breach, performance becomes impossible from the perishing of the thing without default of the contractor

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Davis Constructors Ltd. v. Fareham UDC

[1956] A.C. 696 (H.L.)

Definition of frustration:

“Frustration occurs whenever the law recognizes that without default of either party a contractual obligation has become incapable of being performed because the circumstances in which performance is called would render it a thing radically different from that which was undertaken by the contract. Non heac in foedera veni. It was not this that I promised to do”

The materials upon which the court must proceed to make a decision: terms and construction of the contract, read in light of the then existing circumstances, and the events which have occurred.

In this case two things prevent the application of the principle of frustration

a) the cause of delay was not any new state of things which the parties could not reasonably be thought to have foreseen;

b) contractor cannot rely on frustration to get him out of his unfortunate predicament