Termination or Discharge of a Contract
When the parties fulfill their obligations to each other’s satisfaction, the contract is said to have been discharged by performance. This is usually the desired situation. However, due sometimes to unforeseen circumstances, all contracts to do not end by performance. In section will cover different ways a
contract ends. There are six main ways under which a contract may be discharged: performance; agreement by the parties; frustration; breach; operation of law; and lapse of time.
Discharge by Frustration
Discharge by Frustration occurs where there is a valid contract but the work becomes impossible to perform due to subsequent or supervening events outside of the control of the parties.
Some types of the frustrating event making a contract impossible to perform:
- Destruction of the subject matter, e.g., by fire or by the city authority having declared in uninhabitable
- Death or incapacity, due to illness, of one person in a contract which requires personal performance, e.g., if the singer you had hired to sing at you wedding dies. The case of Robinson v Davison [1871] where illness prevented the pianist from giving a concert and it was held that personal performance was impossible, the contract was discharged.
- Seizure of a ship by a foreign government
- Sinking of the ship in the contract
Important restrictions about frustration
The following are not frustration:
- Initial Impossibility is not frustration. See The case of Couturier v Hastie [1856]
- Self-induced frustration is not frustration at law. See the case of Maritime National Fish v Ocean Trawlers [1935] and The super servant two [1990]
- Foreseeability of the frustrating event. The case of Walton Harvey Ltd v Walker & Homfrays Ltd [1931].
- A mere increase in expenses or loss of profit does not amount to frustration. The case of 300 tons of Sudanese ground nuts destined for Hamburg. In this case the plaintiff agreed to supply the defendant 300 tons of Sudanese groundnuts to be shipped to Hamburg.
Breach and remedies or damages?
Type of equitable remedies
