25 - Frustration - problem solving exercise PDF

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SEMINAR 25 – FRUSTRATION PROBLEM SOLVING EXERCISE 1) Identify contract & parties 2) Assess whether contract is frustrated 3) Impact of frustration Chaucer Occasionals FC a local football team, has been drawn to play ‘away’ to Chelsea FC in London in the FA cup on Saturday 26 Janu...

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SEMINAR 25 – FRUSTRATION PROBLEM SOLVING EXERCISE

1) Identify contract & parties 2) Assess whether contract is frustrated 3) Impact of frustration

Chaucer Occasionals FC a local football team, has been drawn to play ‘away’ to Chelsea FC in London in the FA cup on Saturday 26 January. Ollie, the chairman of the club, agrees with Stan that for £2,000 Stan will: a.

provide transport for the members of the supporter’s club to the London ground, and

b.

provide entertainment for those supporters after the game on the Saturday night at ‘Chumps’ a London disco. Ollie pays Stan £600 in advance and Stan spends £800 in reserving motor coaches and ‘Chumps’ for the date of the game. Ollie also arranges with Jack, a local tailor, for fifteen fluorescent pink suits to be made up to fit the first team squad at a total contract price of £750. These are to be worn by the players as a publicity gimmick during the television interview at lunchtime on the Saturday of the game. Jack would not normally make suits in such an unusual colour, but as a life-long fan of the team, Jack agrees on this occasion. Jack delivers the suits as they are completed, and by 24 January he has delivered ten of them, but has received no part of the price. The match is cancelled two days before it is due to be played because supporters of an East London football club dig up the Chelsea pitch in protest at comments by Ollie, reported in the national press, to the effect that football supporters from the London dockland area are ‘animals’. The television interview is, as a result, also permanently cancelled as any subsequently rearranged fixture would not be played on a Saturday. Advise Stan and Jack.

1) Parties – Ollie & Stan Ollie & Stan, contract = provide transport & entertainment for £2000 £600 paid by Ollie, £800 expenses 2) Frustrated? Does the game being cancelled mean a discharge of obligations? Was the football match the foundation of the contract? Krell v Henry (1903) – was foundation (main event) Herne Bay Steam Boat Co v Hutton (1903) – wasn’t foundation (still some commercial purpose) Self-induced frustration – Ollie responsible, his fault they dug up the pitch (Maritine National Fish Ltd v Ocean Trawlers Ltd (1935); Superservant II) 3) Impact – Law Reform (Frustrated Contracts) Act 1943 s1(2) following common law: affect would be that couldn’t recover £600 already paid and would have the pay the outstanding balance (£200) (Appleby v Myers (1866-67))

BUT Expenses – allowed to obtain just sum to cover expenses, but moment in time when contract was frustrated how much money was payable – max = £600, but going to be down £200

1) Parties -Ollie & Jack £750 for suits to be worn for TV interview 2) Frustrated? Television interview as foundation of the contract? (Krell v Henry (1903)) 3) Impact – Law Reform (Frustrated Contracts) Act 1943 s1(3) – attempts to deal with problem of unjust enrichment (getting things for free), court has discretion to award a just sum (capped at value of goods at which received) Valuable benefit has been received – payment due? Future payments do not need to be made Ability to recover for benefits conferred by partial performance of the contract (Jack delivered 10 of them but had received no part of the price)

Reading: Murray, Contract Law – Fundamentals Chapter 13 Duxbury, Contract Law Textbook Chapter 10...