Question 1

All Sugar Co has decided to expand its operations and import cane sugar from Cuba. It has chartered five ships and plans to arrange for twenty shipments per month from Havana to Bristol. Blucose Industrial Sugar Co agrees to purchase 5,000 tons of cane sugar from All Sugar. Blucose needs the sugar to fulfil a large order for processed glucose for Clairfield Industries. Assuming that the parties have made no express provision in their contract to cover the following eventualities, in which of the following cases has the contract between All Sugar and Blucose been frustrated?

Accepted Answer

D

Question 2

On 15July, Brian and Jesse plan to attend a large outdoor rock festival in St James's Park. However, because of a heightened terrorist threat in that period on major London landmarks, including Buckingham Palace, the concert has been cancelled at the last minute. Which of the following contracts has been frustrated?

Accepted Answer

The contract with the restaurant is frustrated because the specific purpose of the contract (attending the 'rock & roll buffet' during the festival) cannot be fulfilled due to the cancellation of the concert. The other contracts are not directly dependent on the concert taking place.

Question 3

Consider the following two statements.
I.A contract may be frustrated even if it is still physically capable of performance.
II.A supervening event which is foreseeable, even if only remotely, can never frustrate a contract.
Which of the following statements is true?

Accepted Answer

A contract can be frustrated if an unforeseen event fundamentally changes the nature of the contract, even if performance is still physically possible. However, if an event is foreseeable, it generally does not lead to frustration.

Question 4

Which of the following statements is true?

Accepted Answer

Parties can agree to exclude the operation of the doctrine of frustration in their contract by including specific clauses that address unforeseen events and how they should be handled.

Question 5

Contract parties in warring countries may prevent their contract from being frustrated by a prohibition on trading with enemy aliens by providing in their contract a clause postponing their obligations until the cessation of hostilities.

Accepted Answer

The answer of Contract parties in warring countries may prevent...

Question 6

The Midlands Touring Company contract with Lawrence, owner of the Montgommery Theatre, to hire the premises for two weeks to perform their new production of 'Waiting for Godot'. The Montgommery has been in financial difficulties for years and the bank is threatening to foreclose. Two days before opening night, a fire breaks out in the basement of the premises. A maintenance worker notices smoke coming from the stairs and calls Lawrence. Lawrence tells the maintenance worker to vacate the premises immediately and that he will call the fire department. Realizing the insurance on the premises will get him out of his financial difficulties, Lawrence waits half an hour before making the call to the fire department. By that time, the theatre can no longer be saved and the show will have to be cancelled. Can The Midlands Touring Company claim damages from Lawrence for his non-performance, although they have not yet paid the rental price?

Accepted Answer

Lawrence's deliberate delay in calling the fire department constitutes a breach of contract, as it was a preventable action that led to the non-performance of the contract.

Question 7

Which of the following contracts has been frustrated?

Accepted Answer

The answer of Which of the following contracts has been...

Question 8

Which of the following statements is true?

Accepted Answer

A party cannot rely on a self-induced frustrating event to discharge a contract, but the other party can use it to claim frustration.

Question 9

In January, Angela books a cottage from Summer Tours Co for £700 for use in August. According to the contract, half of the fee is due by 1 June and the remainder by 1 August. Angela's husband, Rodney, is wheelchair bound and Summer Tours agrees to add wheelchair access to all their facilities by the time he arrives. By mid-April, all wheelchair ramps have been completed, costing a total of £300. In the middle of May, a forest fire decimates all of Summer Tours' cottages, frustrating its contract with Angela. What are the financial consequences of frustration?

Accepted Answer

Frustration of contract means that the contract is discharged due to an unforeseen event that makes it impossible or illegal to perform the contract. In this case, the forest fire has destroyed the cottages, making it impossible for Summer Tours to fulfill their contract with Angela. Therefore, Angela is not liable for the booking fee and Summer Tours cannot claim anything from her for the construction of the wheelchair ramps.

Question 10

Bad Girls (a pop group) contracted to give Ziggy (a promoter) ten performances for £2 million. After five, further performances had to be cancelled because of the government's ban on congregating in large numbers due to the outbreak of a vicious and contagious disease. At that point, Ziggy had made gross profits of £4 million from the sale of tickets, DVD, and CD rights. Bad Girls had only been paid £100,000, the rest of the £2 million being payable on completion of the tenth performance. In their claim for payment under section 1(3) Law Reform (Frustrated Contracts) Act 1943, which of the following statements are false?

Accepted Answer

Bad Girls cannot claim half of the contract price or half of the benefit received by Ziggy. Under section 1(3) of the Law Reform (Frustrated Contracts) Act 1943, the court assesses the value of the benefit conferred, and the amount recoverable is at the court's discretion, not automatically half of any amount.

Quiz 7: Frustration

Consider the following two statements. I.A contract may be frustrated even if it is still physically capable of performance. II.A supervening event which is foreseeable, even if only remotely, can never frustrate a contract. Which of the following statements is true?

Which of the following statements is true?

Contract parties in warring countries may prevent their contract from being frustrated by a prohibition on trading with enemy aliens by providing in their contract a clause postponing their obligations until the cessation of hostilities.

Which of the following contracts has been frustrated?

Which of the following statements is true?