Skip to main content

Frustration of Contract

 Frustration of Contract

Under the Doctrine of Frustration, it is integrated in Frustration of Contract and Frustration of Purpose in English Law. The American legal system is based on the theory of impossibility and impracticability, and it was adopted into the Indian legal system via section 56 of the Indian Contract Act 1872.

In general, frustration is vanquished, and it is frequently used in agreements and contracts between parties. Frustration has been used to cope with a failed transaction that could not be completed due to a variety of factors. Frustration has been included into contract law as one of the most prevalent difficulties that have been arrived at to cope with failed contracts.

In general, rule parties to contracts are responsible for carrying out their obligations and anybody who breaches them. The party who breaches the contract is obligated to pay the other party. However, Section 56 of the Indian Contract Act of 1872 is an exception to this general norm, and it deals with the Doctrine of Frustration, which arises when an act is not done. A promisor is free of any obligation under a contract if the agreement is breached, and the contract is ruled void as a result of this doctrine.

The doctrine of contract frustration in English law has its origins in Roman law. The earliest instance occurred in Roman contract law, in the case of Paradine versus Jane[3], when the parties were dismissed because the object had been destroyed or the contract's purpose had become impossible to fulfil.

Paradine sued Jane for rent, according to the facts of the case. The defendant claimed that because the German Prince had assumed control of the region where the property was located, he was unable to benefit from it. He had intended to rent out this property when he realised, he might benefit from it by doing so. The defence was not held accountable since the contract's commitment was absolute, with no exceptions. The defendant's rationale, on the other hand, was sound and reasonable. He couldn't have done anything since the Judge believed that the contract's duty should be honoured in all instances.

The Doctrine may be traced back to a Queen's Bench decision in the case of Taylor v Caldwell[4] in England in 1863.

As a result of the above-mentioned Doctrine, the Doctrine of Frustration has developed. The strictness of English law was determined to be unhelpful and unfair in several cases when the contract was impossible to execute due to no fault of the defendant. As a result, an exception to this rule was created.

Major Indian Cases Concerning the Doctrine of Frustration:

Mugneeram Bangur and Company v Satyabrata Ghose and Company & Co .[6]

The defendant corporation has embarked on a proposal to convert the site into a housing colony. On the promise of advance payment, the plaintiff has offered a plot. The business agreed to install the roads and drainage needed to develop the site, making it more suitable for construction and residential use.

The purchaser must pay the remaining sum to finalise the transfer when the work is completed. Meanwhile, during WWII, the state appropriated a major amount of the land for military uses. On the grounds of supervening impossibility, the corporation attempted to annul the contract.

The Court sentenced the offender, holding that the term "impossibility" in Section 56 (Agreement to Perform an Impossible Act) does not refer to a literal or physical act. It described a change in circumstances that rendered the basic basis upon which the parties' agreement was built absolutely unworkable.

It was indicated in the requisition order that it must be permanent rather than temporary. There was no indication of a deadline for when the job should be finished. Because there was no particular date in the contract, and because it was inevitable for some constraints to be in place during the war, the project was hampered and delayed. The reason for the delay is that the requisition order did not affect the primary goal or strike at the right time.


Comments

Popular posts from this blog

Section 58B of The Advocates Act - Special provision relating to certain disciplinary proceedings

 Section 58B The Advocates Act Description (1) As from the 1st day of September, 1963, every proceeding in respect of any disciplinary matter in relation to an existing advocate of a High Court shall, save as provided in the first proviso to sub-section (2), be disposed of by the State Bar Council in relation to that High Court, as if the existing advocate had been enrolled as an advocate on its roll. (2) If immediately before the said date, there is any proceeding in respect of any disciplinary matter in relation to an existing advocate pending before any High Court under the Indian Bar Councils Act, 1926 (38 of 1926), such proceeding shall stand transferred to the State Bar Council in relation to that High Court, as if it were a proceeding pending before the corresponding Bar Council under clause (c) of sub-section (1) of section 56: Provided that where in respect of any such proceeding the High Court has received the finding of a Tribunal constituted under section 11 of the Indian B

Case Laws related to Defamation in favour of ClaimantCase Laws related to Defamation in favour of Claimant. TOLLEY Vs, J.S FRY & SONS LTD – (1931) Facts The defendants were owners of chocolate manufacturing company. They advertised their products with a caricature of the claimant, who was a prominent amateur golfer, showing him with the defendants’ chocolate in his pocket while playing golf. The advertisement compared the excellence of the chocolate to the excellence of the claimant’s drive. The claimant did not consent to or knew about the advertisement. Issue The claimant alleged that the advertisement suggested that he agreed to his portrait being used for commercial purposes and for financial gain. He further claimed that the use of his image made him look like someone who prostituted his reputation for advertising purposes and was thus unworthy of his status. At trial, several golfers gave evidence to the effect that if an amateur sold himself for advertisement, he no longer maintained his amateur status and might be asked to resign from his respective club. Furthermore, there was evidence that the possible adverse effects of the caricature on the claimant’s reputation were brought to the defendants’ attention. The trial judge found that the caricature could have a defamatory meaning. The jury then found in favor of the claimant. Held The House of Lords held that in the circumstances of this case – as explained by the facts – the caricature was capable of constituting defamation. In other words, the publication could have the meaning alleged by the claimant. The Lords also ordered a new trial limited to the assessment of damages. NEWSTEAD V LANDON EXPRESS NEWSPAPER LTD, (1939) Facts: A newspaper published a defamatory article about Harold Newstead. However, another person with this name brought an action in libel. He claimed that the article had been misunderstood as leading to him. The defendant newspaper recognised that they published the article. Also, they denied that they had the intention of being defamatory of him. Consequently, the claimant argued that the newspaper was under a duty. The duty was to give a clear and complete description of the correct person. Moreover, the claimant argued that the defendants were in breach of the duty. Issues: The issue in Newstead v London Express Newspaper, was if the reasonable persons would have understood the words complained of to refer to the plaintiff. Held: The Court of Appeal stated that in accordance with the current law on libel, liability for libel does not depend on the intention of the defamer; but on the fact of the defamation. Accordingly, a reasonable man, in this case a newspaper publisher, must be aware of the possibility of individuals with the same name and must assume that the words published will be read by a reasonable man with reasonable care.

  Case Laws related to Defamation in favour of Claimant.  TOLLEY  Vs,  J.S FRY & SONS LTD – (1931) Facts The defendants were owners of chocolate manufacturing company. They advertised their products with a caricature of the claimant, who was a prominent amateur golfer, showing him with the defendants’ chocolate in his pocket while playing golf. The advertisement compared the excellence of the chocolate to the excellence of the claimant’s drive. The claimant did not consent to or knew about the advertisement.   Issue The claimant alleged that the advertisement suggested that he agreed to his portrait being used for commercial purposes and for financial gain. He further claimed that the use of his image made him look like someone who prostituted his reputation for advertising purposes and was thus unworthy of his status. At trial, several golfers gave evidence to the effect that if an amateur sold himself for advertisement, he no longer maintained his amateur status and might be aske

Rules as to delivery of goods

                             Rules as to delivery of goods Section 2(2) of Sale of Goods Act defines ‘delivery’ as a ‘voluntary transfer of possession from one person to another.’ Thus, if the transfer of goods is not voluntary and is taken by theft, by fraud, or by force, then there is no ‘delivery. Moreover, the ‘delivery’ should have the effect of putting the goods in possession of the buyer. The essence of the delivery is a voluntary transfer of possession of goods from one person to another. There is no delivery of goods where they are obtained at pistol point or theft. 1. Mode of Delivery: According to Section 33, delivery of goods sold may be made by doing anything which the parties agree shall be treated as delivery or which has the effect of putting the goods in the possession of the buyer or of any person authorized to hold them on his behalf. Delivery of goods may be actual, symbolic or constructive. 2. Expenses of Delivery: According to Section 36(5), unless otherwise agree