The Doctrine of Frustration

Frustration occurs whenever a contract after it was entered into becomes impossible to be performed and/or incapable of being performed without default by any party to the contract, obliged to perform their respective contractual duty(ies). Section 57 (2) of the Contract Act 1950 [Act 136] (“Act”) read as follows:-

“…A contract to do an act which, after the contract is made, becomes impossible, or by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful…”. In other words, the contract is frustrated.

For the doctrine of frustration to apply, three (3) elements shall be established and if any of the elements are not present on the facts of a given case, then Section 57 of the Act does not bite. The three (3) elements are as follows:-

a) no provision made in the contract in the event the contract is frustrated;

b) the partly pleading it shall not be responsible for the frustrating event. Another way of putting it is that self-induced frustration is no frustration; and

c) the frustrating event caused the performance to be impossible, unlawful, or fundamentally different from what was originally agreed.

Section 57 (1) of the Act provides that a frustrated contract is void.

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