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9 Cards in this Set
- Front
- Back
Frustration |
Frustrating event before contract completed may discharge contract. 3 types: |
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1) Impossibility of performance where is impossible for contract be completed (Nichol and Knight v Ashton Eldridge). Not apply if performance possible just more difficult/ expensive than anticipated (Davis v Fareham) |
2) radical change in circumstances if change relates to main purpose of contract (Krell v Henry). Change must be sufficiently radical (Herne Bay v Hutton) |
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3) illegality of contract where change in law makes contract illegal to perform (Shipton Anderson) |
However frustration will not apply where: |
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It is self induced i.e. one of the parties fault (Maritime National Fish v Ocean Trawlers) |
Or there was a foreseeable risk of frustrating event occurring (John Walker and Sons) |
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Under S1(2) of the Law Reform (Frustrated Contracts) Act 1943, money paid before frustrating event may be reclaimed, minus the other party's expenses. |
Under S1(3) the value of benefit gained by one party, other than money received must be paid back to other party. The judge will assess this. |
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Conclude |
Intention |
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Commercial contracts have presumption that there is an ICLR= legally binding (Carlill v Carbolic Smoke Ball) |
Presumption can rebutted where clear words are used to show no legal intent i.e. act of goodwill, binding in honour (Jones v Vernons Pools) or where words are too vague to be specific promise (letter of comfort- Kleinwort Benson) |
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Contracts involving free gifts & competition prizes = legally binding (McGowan v Radio Buxton) |
Domestic contracts i.e. between family members have presumption that no ICLR = not legally binding (Balfour v Balfour) |
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Presumption rebutted where is commercial basis to contract & basis no longer love and affection & if parties acted on the promise (Merritt v Merritt, Simpkins v Pays) |
Where clear words used show no legal intent i.e. act of goodwill, binding in honour, contract between family members not legally binding even if has commercial basis (Jones v Vernons Pools) Conclude |