Frustration of Contract in United Kingdom

Frustration of Contract in Contract Law

According to Questions & Answers Law of Contract: Law Revision and Study Guide (Law Questions & Answers, Oxford University Press), by Adrian Chandler and Ian Brown, Frustration of Contract may have the following meaning: The unforeseen termination of a contract as a result of an event that either renders its performance impossible or illegal or prevents its main purpose from being achieved. Frustration would, for example, occur if the goods specified in a sale of goods contract were destroyed (impossibility of performance); if the outbreak of a war caused one party to become an enemy alien (illegality); or if X were to hire a room from Y with the object (known to Y) of viewing a procession and the procession was cancelled (failure of main purpose). Unless specific provision for the frustrating event is made, a frustrated contract is automatically discharged and the position of the parties is, in most cases, governed by the Law Reform (Frustrated Contracts) Act 1943. Money paid before the event can be recovered and money due but not paid ceases to be payable. However, a party who has obtained any valuable benefit under the contract must pay a reasonable sum for it. The Act does not apply to certain contracts for the sale of goods, contracts for the carriage of goods by sea, or contracts of insurance.