Frustration of Contract.

By Simran Joshi

The author is a 3^rd-semester law student at Amity Law School Lucknow

Even though the Indian Contract Act does not precisely define the term FRUSTRATION but it still covers all the bases and provisions of Doctrine of Frustration under section 56 of the Indian Contract Act. The doctrine of Frustration of contract refers to when a particular event becomes impossible or unlawful after the completion of a contract.

Events beyond the control may occur which frustrates the purpose of their agreement or render very difficult or impossible or even illegal to perform. An example of this is supposing that if  I agree to sell you my house but then my house burns down

HISTORY OF THE DOCTRINE OF FRUSTRATION

The origin of the doctrine of Frustration of contract as many other laws has been from the Roman laws.It was part of the roman contract law which extinguished obligations of innocent parties where the thing is destroyed without the debtor’s act or default and the contract purpose has ceased to be attainable.

It was implied in Roman times, for instance, to save, from liability, a man who promised to deliver a slave by a certain day if the slave died before delivery.

The first instance of the doctrine of Frustration can be traced back to the queen bench judgment in 1863 in the case of   TAYLOR VS CARDWELL.In this case, a music hall was hired by the claimant from the defendant for concerts but before the concert or program took place, a fire broke out and the entire hall was destroyed. The claimant sued for breach of contract despite no party being at fault. However, the defendant was released from their obligations under the Doctrine of Frustration.

This Case is a Fundamental case in the area of frustration with regard to contract law. Taylor vs Cardwell is an extremely important case. Frustration developed to alleviate the harshness of the absolute obligation rule. Frustration comes about in circumstances where the courts will discharge the parties of obligations under the contract, therefore meaning that the parties are not liable for any further obligations under the contract.

ILLUSTRATIONS OF FRUSTRATION UNDER SECTION 56 OF THE INDIAN CONTRACT

1.  DEATH OR DELAY  – A party to a contract is free from any kind of obligations if it depends on the existence of a person and that person fells ill or die . Thus where the nature of terms of a contract require personal performance by the promisor, his death or incapacity puts an end to the contract.

•  NON OCCURRENCE OF CONTEMPLATED EVENTS – when the performance of the contract remains entirely possible but owing to the non occurrence of an event contemplated by both parties as the reason for the contract , the value of the performance is destroyed , it ends the contract.

• CHANGE OF CIRCUMSTANCES -where circumstances arise which make the performance of the contract impossible in the manner and at the time contemplated , the contract will frustrate and end .

• PHYSICAL DAMAGE OF THE SUBJECT MATTER – Where the actual subject matter of the contract gets damaged or destroyed and not possible for the performance or use , it renders the end of contract
• GOVERNMENT, ADMINISTRATION, LEGISLATION   INTERVENTION – A contract will come to an end when legislative or administrative intervention has direct effect on the fulfillment of the contract for a specific work as to transfer the contemplated conditions of performance.

CONCLUSION

The doctrine of frustration plays a very important role in contract law. It has been given statutory authority under section 56 of the Indian Contract Act. It legitimately justifies the genuine reasons behind rendering the contract to an end and makes contracting provisions more smooth and blunt. There is not an exhaustive list of events that can frustrate a contract, it continues to develop as this doctrine is a dynamic provision under sec 56 of the Indian Contract Act.

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