What is the Doctrine of Frustration (Sec 56)?
Sec 56 of the Indian Contract Act, 1956, enumerates on the “Doctrine of Frustration” of a contract.
Doctrine of Frustration basically enumerates on the impossibility to perform the contract. It basically means, a contract could not be executed because of such an event that was beyond the control of both the parties. The performance of such a contract, renders it difficult or impossible, or even illegal.
For eg, A singer losing on the day of a concert but has prior to the event signed a contact to sing at the concert. Such a case, amounts to the supervening impossibility of the singer to sing on the date of the event, because he does have the voice to do so. Here the contract between the event manager and the singer does not execute itself, due to impossibility of performance.
Frustration includes unforeseen events, impossible events, events not under human control, or default events.
Grounds for frustration of contract
1. Destruction of Subject-matter:
As seen in the landmark judgement of TAYLOR Vs CALDWELL, Taylor entered into a contract with Caldwell, to perform at the an event, however on the day of the event, the concert hall burned down. Taylor, therefore cannot perform at the event. The burned down hall directly implies the impossibility of performance of contract.
2. Change in Circumstances:
Change in circumstances makes performance impossible or tough in the manner and the time contemplated.
For eg: A and B (islamic individuals) contract to marry each other. However, before the date of marriage, A goes missing. The contract becomes void as they cannot get married on the stipulated date.
3. The Death of Incapacity of the Party:
If the contract demands a personal performance of the promisor, his death, incapacitates the performance of a contract or puts the contract to an end.
For eg: A entered into a contract with painting artist, M.F. Hussain. M.F Hussain dies before completion of the painting. The contract becomes frustrated.
4. Government Legislation:
An act or law, if passed by the government contravenes with the object the contract, it leads to frustration of contract.
For eg: ‘A’ to open liquor shops on highway utilities, however the new law prohibits liquor shops within the radius of 500 m from highway. The contract becomes void.
5. The Intervention of War:
Suppose A(from India) and B(from Pakistan) enter into a contract for the trade of goods. Subsequently, Pakistan and India proclaim war against each other. The contract becomes void.
Th effect of frustration gives the immediate effect of dissolution of contract automatically.