Ratio Decidendi
Where performance of a contract depends on the continued existence of a specific thing, and that thing is destroyed without fault of either party, the contract is discharged by frustration. Both parties are excused from further performance.
Facts
Taylor agreed to hire the Surrey Gardens and Music Hall from Caldwell for four days to hold concerts. Before the first concert, the hall was destroyed by an accidental fire. Taylor sued for damages for loss of profits.
Judgment Summary
Blackburn J held that the contract was subject to an implied condition that the hall would continue to exist. Its destruction, without fault of either party, discharged both parties from their obligations. This was the first clear statement of the doctrine of frustration.
Key Quotes
"In contracts in which the performance depends on the continued existence of a given person or thing, a condition is implied that the impossibility of performance arising from the perishing of the person or thing shall excuse the performance."
— Blackburn J
Subsequent Treatment
Origin of the modern doctrine of frustration in English law. Developed by Davis Contractors v Fareham UDC [1956] and the Law Reform (Frustrated Contracts) Act 1943.