THE DOCTRINE OF FRUSTRATION

The doctrine of frustration is mentioned under section 56 of the Indian Contract Act and it says “A contract to do an act which, after the contract is made, becomes impossible, or, because of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful.” It comes into play when the act or the duty to be performed become impossible of performance or the circumstances are such that is beyond the control of the party or change in the circumstances makes it impossible to happen. The court can give relief on the ground of subsequent impossibility if it finds that the whole basis or structure of the contract gets frustrated or impossible to happen due to any unforeseen circumstances which the parties haven’t anticipated while making the contract. This doctrine can not be used or the defendant cannot take its defence if he failed to perform the contract.

The source of the doctrine of frustration in English Law is the case of Taylor v. Caldwell. In this case, it was held that the opera house, which was rented to people for concerts got burnt in the fire, the contract gets frustrated as the very thing on which the contract was signed got destructed and hence it became impossible to have that contract. Based on this case court said that for the doctrine of frustration, the nature of the contract should be such that it would not operate if a thing ceased to exist. Again, in the case of Krell v. Henry, where rooms were rented for the king’s coronation but it got postponed due to his illness. The contract was said frustrated and hence, it was stated that the doctrine will also be applicable where certain things didn’t happen.

Effect of force majeure clause and the doctrine of frustration is more or less same, both lead to the discharge of contract and thus relieving them from the obligations of the contract. Due to the fear that the court may not allow the doctrine of frustration, parties have force majeure clause in their agreement stating relieves that will be provided under any unforeseen circumstances. Force majeure clause can also provide an extension of time as relief instead of discharging the parties of their contractual obligations and this is the difference between the doctrine of frustration and force majeure clause. For example, the agreement to transfer goods from one place to other through ship may have the provision that if the party failed to transfer the good on time then some reasonable extra time will be given. 

Hence, if the parties don’t have the force majeure clause in their agreement to provide any remedy in case of non-performance of the contract due to supervening event which was not attributable by any of the parties then the concept of the frustration of contract present in the common law(Section 56 of the Indian Contract Act, 1872) will be applicable and remedies will be granted as per it by the judicial body.