APPLICATION OF THE DOCTRINE OF FRUSTRATION
In the commercial world, unlimited agreements and contracts are made and the parties are expected to perform their part. On non- performance, they can be sued by another party for breach of contract. But what if it becomes impossible for a party or for both the parties, to perform their part? Can the parties be sued, having done no fault? This is where the “doctrine of frustration” comes into play.
Meaning of the Doctrine
The concept of the doctrine of frustration comes under S.56 of Indian Contract Act, 1852. This section mentions that an agreement to do an impossible act is in itself void. This doctrine refers to the point that a promisor won’t be held liable under contract if there’s impossibility, for that promisor to perform his or her obligations under that contract. As per this doctrine, the relevant contract will also be held to be void. The basis of this doctrine is that the relevant contract becomes impossible to be performed due to an event which is not under the control of the parties i.e., the contract becomes frustrated.
Application of the Doctrine
The Doctrine of Frustration is applicable under two situations i.e.,
If the object of the contract has become impossible to be performed, or
If any event has occurred, which has made the performance of the contract impossible and is beyond the promisor’s control
So here, we have two circumstances under which this doctrine is applied. The first one is if the object of the contract has become impossible to be performed. Let’s take the help of an illustration here. Suppose A and B are the parties to a contract, in which A has to supply 100 cartons of a special kind of sweet to B and for the same, B will pay rupees y. That sweet is one which is famous to be made by A and B wants it to made by A only. Before performing her obligation i.e., making and delivering sweets to B, A died. Now, it has become impossible to fulfill the contract’s object here. B can’t do anything in this, as it was beyond her control. So, the doctrine of frustration will apply and B won’t be able to get the desired sweets. Also, she can’t sue A’s legal heirs or anyone for the performance of contract’s obligations.
Further, we have another situation under which this doctrine is applicable i.e., when any event has occurred, which has made the performance of the contract impossible and is beyond the promisor’s control. Taking another illustration for this: Suppose A and B have contracted, in which A has to supply 100kg mangoes to B, from India to Australia. Two weeks before the delivery, a new law was passed in India declaring export and import of edible items to be illegal in India. Now., the parties have no control over this situation and can do nothing but frustrate. The performance of the contract has become impossible.
In both the cases, the agreement would have been completely valid and turned into contract subsequently. But, due to unwanted and unavoidable circumstances, they became void or illegal to be performed.
Generally, this occurs in the following cases:
Death of a party or Incapacity of party
By virtue of legislation
Due to change of circumstances
Mentioning two cases in which this particular doctrine was applied:
Robinson v. Davison
Rozan Mian v. Tahera Begum
In the case Robinson v. Davison, as per the contract, a piano player had to perform at a concert but on the day of performance, he fell ill. It was held by the court that falling ill wasn’t the piano player’s fault and to be unable to perform at the concert was not under his control. The contract was frustrated.
In the case Rozan Mian v. Tahera Begum, the specific performance of the agreement for sale became impossible to be performed, by reason of promulgation of the West Bengal Thika Tenancy, during the pendency of the suit. Due to operation of law, the contract became void and was frustrated.
It can be concluded that no matter how many years pass by but this doctrine will always have its effect and will come into play. This is so because be it any time, unforeseeable events will always occur, making the performance of contract impossible. The doctrine has got importance because it exempts the parties from their liabilities, as they had no control over the performance of relevant contract.