The Fido Ltd, in order to improve and promote their business, decided to conduct a cat show. Accordingly, they entered into an agreement with the local hospital to utilize their grounds for the event. The cost of hire for the grounds was ? 500 payable on the day of the event. Further, they entered into an agreement with the Fun and Games Ltd to float a cat shaped giant bouncy castle, as they were desirous of holding a fete with stalls that would contain specialized cat accessories. The charges for this bouncy castle were ?
2,000, with ? 1,000 to be paid a day in advance and the balance on the day of the event. The cats that had to participate in a cat show to be conducted by Fido Ltd came down with influenza. However, Fido Ltd, wanted to sell cat accessories, in addition to conducting a cat show. The agreement between Fido Ltd and the local hospital was with regard to conducting the cat show and to put up stalls for selling cat accessories on the latter’s grounds. A contract may not be frustrated if it had been formed for several more reasons .
As such in the present case, the cat show is not the sole event that forms the contract and there are additional events like the display of cat accessories and public entertainment shows. Since there are many events to be conducted in executing the contract, it cannot be considered as frustrated due to the failure of one of the events. The sale of cat accessories is not precluded by the absence of the cats; Fido Ltd cannot plead frustration of the contract to rescind the agreement.
In our case, in order to determine whether the contract had been frustrated or not, we have to examine the issues that were discussed in the case of Krell v Henry In this case, the plaintiff had displayed an offer to let out rooms on rent. The rooms were to afford a view of the royal coronation processions that were to take place in the street below. The defendant, desirous of observing these processions, offered to pay an amount of ? 75 towards rent and paid ? 25 as a deposit. Subsequently, the processions were cancelled due to the King having fallen ill.
The defendant refused to pay the remaining amount to the plaintiff who thereupon sued the defendant for refusal to pay the remaining ? 50. However, the defendant filed a suit against the plaintiff to recover the ? 25 paid by him as a deposit. The Court held that the defendant was not required to pay rent for the rooms since the contract was entirely based on the occurrence of the royal procession, scheduled on those dates. Both the parties had entered into the contract on account of the procession, which had been subsequently cancelled.