DISCHARGE BY IMPOSSIBILITY OR SUPERVENING IMPOSSIBILITY OR DOCTRINE OF FRUSTRATION

• DISCHARGE BY IMPOSSIBILITY
  (SUPERVENING IMPOSSIBILITY)
  DOCTRINE OF FRUSTRATION
  BUSINESS LAW
• DISCHARGE OF CONTRACT
• A CONTRACT IS SAID TO BE DISCHARGED OR TERMINATED WHEN THE RIGHTS AND OBLIGATIONS CREATED BY IT ARE EXTINGUISHED. A CONTRACT CAN BE DISCHARGED IN MANY WAYS:
• DISCHARGE BY AGREEMENTS( SECTION 62.63)

1. DISCHARGE OF OPERATION OF LAW
2. DISCHARGE BY BREACH (SECTION  39)
3. DISCHARGE BY PERFORMANCE ( SECTION 37 AND 38)
4. DISCHARGE BY IMPOSSIBILITY( SECTION 56)
5. DISCHARGE BY LAPSE OF TIME
6. DISCHARGE BY IMPOSSIBILITY OF PERFORMANCE

• AGREEMENT WHICH ARE IMPOSSIBLE IN ITSELF ARE VOID BECAUSE LAW DOES NOT COMPEL THE IMPOSSIBILITY’
• THE IMPOSSIBILITY MUST BE IN EXISTENCE AT THE TIME WHEN THE CONTRACT IS MADE AND MAY OR MAY NOT BE KNOWN TO BOTH THE PARTIES AT THAT TIME
• BUT IF THE PROMISOR KNOWS ABOUT THE IMPOSSIBILITY THEN EXISTING, HE IS BOUND TO PAY THE COMPENSATION
• ALSO KNOWN AS DOCTRINE OF FRUSTRATION IN ENGLISH LAW
• FRUSTRATION MEANS THE DISCHARGE OF A CONTRACT RENDERED IMPOSSIBLE OF PERFORMANCE BY EXTERNAL CAUSES BEYOND THE CONTEMPLATION OF THE PARTIES
• THREE CONDITIONS FOR INVOKING SECTION 56
• THE FOLLOWING CONDITIONS MUST BE SATISFIED FOR APPLYING THE DOCTRINE OF FRUSTRATION:-

1. THE ACT SHOULD HAVE BECOME IMPOSSIBLE
2. BY REASON OF SOME EVENT ON WHICH THE PROMISOR COULD NOT PREVENT
3. THE IMPOSSIBILITY SHOULD NOT BE SELF INDUCED BY THE PROMISOR

4.     A ND B CONTRACT TO MARRY EACH OTHER BUT BEFORE THE TIME FIXED FOR THE MARRIAGE,B GOES MAD.THE CONTRACT BECOMES VOID

• SUPERVENING IMPOSSIBILITY
• DESTRUCTION OF THE SUBJECT MATTER :- TAYLOR V CALDWELL
• DEATH OR PERSONAL INCAPACITY :- ROBINSON V DAVISON
• CHANGE OF LAW
• NON EXISTENCE OR NON OCCURRING OF A PARTICULAR STATE OF THINGS
• DECLARATION OF WAR
• SUPERVENING IMPOSSIBILITY
• DESTRUCTION OF THE SUBJECT MATTER:- WHERE THE SUBJECT MATTER OF A CONTRACT IS DESTROYED WITHOUT THE FAULT OF PARTIES TO THE CONTRACT,THE CONTRACT IS DISCHARGED
• CASE: TAYLOR V CALDWELL:
•  A MUSIC HALL WAS AGREED TO BE LET OUT ON CERTAIN DATED,BUT BEFORE IT WAS DESTROYED BY FIRE.IT WAS HELD THE OWNER IS DISCHARGED
• BUT WHEN A PART OF THE SUBJECT MATTER IS DESTROYED,THE OWNER IS NOT CHARGED IN OTHER PART WHICH IS NOT DESTROYED
• DEATH OR PERSONAL INCAPACITY:- A PROMISE MAY BECOME PHYSICALLY INCAPABLE OF PERFORMANCE BY REASON OF INCAPACITY OR DEATH
• CASE ROBINSON V DAVISON
• CONTRACT WAS MADE WITH AN ARTIST TO SING ON PARTICULAR DAY BUT HE COULD NOT SING AS HE WAS TOO ILL

• CHANGE OF THE LAW:-WHEN MADE THE LAWFUL BUT LATER ON BECOMES UNLAWFUL BECAUSE OF CHANGE IN LAW.
• EXAMPLE:- THERE WAS A CONTRACT TO SUPPLY OIL SEEDS BUT GOVERNMENT MADE ITS SALE AND PURCHASE UNLAWFUL UNDER THE DEFENCE OF INDIA. BOTH PARTIES WERE DISCHARGED
• NON EXISTENCE OR NON OCCURRING OF PARTICULAR STATE OF THINGS:-WHEN THE BASIS OF THE CONTRACT NO LONGER EXIST THEN CONTRACT IS DISCHARGED
• EXAMPLE:-KRELL V HENRY
• CONTRACT FOR THE HIRE OF FLAT FOR VIEWING THE CORONATION PROCESSION OF THE KING IN 1902 BUT THAT WAS ABANDONED DUE TO ILLNESS OF THE KING. HERE THE EXISTENCE OF THE PROCESSION WAS THE BASIS OF THE CONTRACT AND ITS CANCELLATION DISCHARGED THE CONTRACT
• DECLARATION OF WAR:-
• BEFORE THE COMMENCEMENT OF WAR REMAINS SUSPENDED DURING THE WAR MAY BE REVIVED AT END OF THE WAR
• A MERCHANT OF LONDON HAD AGREED TO DELIVER SUGAR F.O.B. WAR BROKE OUT BETWEEN ENGLAND AND GERMANY.HELD THAT THE CONTRACT WAS DISSOLVED BY THE OUT BREAK OF WAR.
• EXCEPTIONS

1. DIFFICULT OF PERFORMANCE
2. COMMERCIAL IMPOSSIBILITY
3. IMPOSSIBILITY DUE TO THE FAILURE OF A THIRD PERSON ON WHOSE WORK THE PROMISOR RELIED
4. SELF INDUCED IMPOSSIBILITY
5. FAILURE OF ONE OF THE OBJECTS
6. STRIKES, LOCKOUT AND CIVIL DISTURBANCE

• EXCEPTIONS
• DIFFICULTY OF PERFORMANCE :-NOT DISCHARGED BY THE REASON

1. PERFORMANCE MORE DIFFICULT OR
2. MORE EXPENSIVE
3. MORE BURDENSOME
4. LESS PROFITABLE

5.     KESHAV LAL V DEWAN CHAND

·         D AGREED TO SUPPLY COAL WITH IN CERTAIN FIXED TIME BUT DUE TO GOVERNMENT RESTRICTION ON THE TRANSPORT OF THE COAL FROM THE COLLIERIES THERE WAS FAILURE BUT COAL WAS AVAILABLE IN OPEN MARKET. NOT A CASE OF IMPOSSIBILITY OF PERFORMANCE

• COMMERCIAL IMPOSSIBILITY:-STRIKES,LOCKOUT AND CIVIL DISTURBANCE DO NOT TERMINATE THE CONTRACT. A STRIKE BY THE WORKMEN COULD NOT EXCUSE PERFORMANCE AS LABOUR WAS AVAILABLE OTHERWISE
• HARI LAXMAN V SECRETARY OF STATE,
• AN AGREEMENT BETWEEN A AND B TO REPAIR CERTAIN MACHINERY BUT A WAS NOT ABLE TO DUE TO STRIKE OF WORKMEN. NOT SUFFICIENT CAUSE TO EXCUSE PERFORMANCE
• IMPOSSIBILITY DUE TO THE FAILURE OF THIRD PERSON ON WHOSE WORK THE PROMISOR RELIED:-
• PHUL CHAND V PRAG DAS: A AGREED TO SELL GOODS TO TO B AS WHEN HE GOT THE SAME FROM THE MILL  WITH WHICH HE PLACED ORDERS. THE MILLS FAILED TO SUPPLY. NO IMPOSSIBILITY OF PERFORMANCE
• SELF INDUCED IMPOSSIBILITY: WHEN THE IMPOSSIBILITY IS DUE TO THE DEFAULT OF THE CONTRACTING PARTY HIMSELF,SECTION 56 WOULD NOT APPLY.
• A PROMISOR IS NOT DISCHARGED WHEN HIS FAILURE TO PERFORM IS CAUSED BY HIS ARREST AND CONVICTION FOR CRIME.
• FAILURE OF ONE OF THE OBJECT:- WHEN A CONTRACT IS ENTERED FOR SEVERAL OBJECTS,FAILURE OF ONE OF THE DOES NOT TERMINATE THE CONTRACT.
• X AGREED TO LET OUT A BOAT FOR Y FOR THE PURPOSE OF VIEWING A NAVAL REVIEW HELD ON THE OCCASION OF THE CORONATION OF EDWARD VII AND TO CRUISE ROUND THE FLEET. OWING TO KING’S ILLNESS THE NAVAL REVIEW WAS ABANDONED BUT THE FLEET WAS ASSEMBLED AND THE BOAT COULD HAVE BEEN USED TO CRUISE ROUND THE FLEET.

• STRIKES,LOCK OUT AND CIVIL DISTURBANCE:-
• JACOB V CREDIT LYONNIS
• X AGREED TO SUPPLY CERTAIN GOODS TO Y. THE GOODS WERE TO BE PROCURED FROM ALGERIA. OWING TO RIOTS AND CIVIL DISTURBANCE IN THAT COUNTRY GOODS COULD NOT BE BROUGHT. THIS WAS NOT EXCUSE FOR THE NON PERFORMANCE OF THE CONTRACT.
• EFFECT OF IMPOSSIBILITY
  
  
• CONTRACT BECOMES VOID
• BENEFIT TO BE RESTORED :- MAN SINGH V KHAZAN SINGH: IN THIS CASE THERE WAS CONTRACT BETWEEN A AND B FOR CUTTING BABOOL TREE ON B’SLAND BUT AN ORDINANCE LATER ON BANNED THE CUTTING OF TREES WITHOUT LICENSE UNLAWFUL FUL. A WAS NOT ABLE TO GET THE LICENCS AND FILED FOR THE RECOVERY OF AMOUNT OF CONSIDERATION AND COMPENSATION.

• COMPENSATION FOR NON PERFORMANCE:A CONTRACT MAY BE VOID BUT COMPENSATION MAY BE PAYABLE BY THE PERSON WHO IS UNABLE TO PERFORM IT