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Contract: Discharge of Contract

Frustration: illegality, sterility and radical change

  • 3 things to know
  • Components 2 and 3

Overview

Supervening illegality, requisition, and the coronation cases that separate Krell v Henry from Herne Bay, with the Davis Contractors test of radical difference and how The Sea Angel applies it today.

What you need to know

Answer each one before you reveal it.

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Key term

How does supervening illegality frustrate a contract?

Numbers

Which case shows frustration by wartime prohibition?

Numbers

How can requisition by the government frustrate a contract?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    How does supervening illegality frustrate a contract?

    Model answer

    Supervening illegality occurs where a change in the law makes performance unlawful. The contract is discharged because the law cannot compel an illegal act.

  2. 2

    Which case shows frustration by wartime prohibition?

    Model answer

    Denny, Mott and Dickson v James B Fraser & Co [1944] concerned a timber trading agreement prohibited by wartime controls. The prohibition frustrated the contract.

  3. 3

    How can requisition by the government frustrate a contract?

    Model answer

    Re Shipton, Anderson & Co [1915] concerned wheat requisitioned by the government before delivery. The seller was excused because delivery had become unlawful.

  4. 4

    What is frustration of purpose or sterility?

    Model answer

    Frustration of purpose occurs where performance is still possible but the whole point of the contract has gone. The contract becomes commercially sterile.

  5. 5

    Which case is the leading authority on frustration of purpose?

    Model answer

    Krell v Henry [1903] concerned a room hired to watch the coronation procession. Cancellation of the procession destroyed the sole purpose of the hire.

  6. 6

    Why was the contract not frustrated in Herne Bay Steam Boat Co v Hutton [1903]?

    Model answer

    Herne Bay Steam Boat Co v Hutton [1903] concerned a boat hired to watch a naval review and to cruise the fleet. The review was cancelled but the cruise remained possible, so the purpose had not wholly failed.

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AAn interim injunction restrains publication before trial.
BPublication cannot be undone.
CAn injunction may be the only effective remedy.

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