Based on 3 questions Essay Example | Topics and Well Written Essays - 2750 words

Based on 3 questions - Essay Example When discharge by frustration, there would be no secondary obligations, but there would be a need for restitution under the law. Other than discharge of the contract by performance, breach and frustration, the contract could also be discharged by agreement, wherein both the parties would agree to put an end to the contract and have a new contract in place to overcome the shortcomings of the earlier contract (Wallis 2008). Discharge by frustration is a process by which the contract is ended by demonstrating frustration. These include certain limited circumstances wherein courts would have deemed that further performance of the contract would be impossible. Usually at the time of discussion and entry of either party into the contract, the factors or causes of frustration should not be known to either party and due to the fault of neither party the event has been caused such that further performance of the contract would be deemed impossible. At first, the doctrine of frustration arose in the case Taylor v Caldwell (1863) 3 B & S 826 where Blackburn J used the [presence of unforeseen circumstances that suddenly arose and rendered further performance of the contract as impossible and due to no fault of either party. In the case, Taylor hired Caldwell for the performance of concert events for 4 days at Pounds 100. The contract was created but due to a fire at the hall of the event, the entire event could not be performed. The plaintiff suffered huge losses due to non-performance of the event. However, there was no provision within the contract that provided a resolution in case of such events. The plaintiff sued the defendant, and the defendant said that due to the non-presence of the hall the event could not be performed (Wallis 2008). The Hon’ble Judge Blackburn found that within the contract there was an implied term which meant that both parties would be excused in case the contract becomes impossible to perform due to no fault of either party that enter into the contract. These circumstances may be unforeseen due to no fault of either party, and even if one party has a doubt that such an event could occur, then the onus would be put on that party (Szantyr 2011). There may be four conditions for discharge of contract by frustration to be satisfied. It may occur as an unforeseen event, it should not be known to either party, it should make performance of the contract impossible and it should create a radically different situation from what was described in the earlier contract. Besides, there are 2 alternative tests for frustration including implied theory test and radical change test. The implied theory test was what was used in Taylor vs. Caldwell, whereas the radical change test was developed in the case Davis Contractors v Fareham UDC [1956] AC 696 (Wallis 2008). Discharge of contract by breach may include defective performance as well as non-performance and would be included either as a condition, warranty or innominate. In orde r to treat such breach as primary and to repudiate the contract, the opposing party should have breached the conditions and not the warranties. In case the warranties are breached, then the contracted cannot be discharged but since the secondary obligations are not fulfilled, damages can be sought (Law Teacher 2012). Unlike discharge by frustration, an anticipatory breach may arise when one party feels that the performance of the contract would be in doubt and have expressed their willingness to discharge the contract. The opposing