Krell v Henry

Ratio Decidendi

Fapte

Henry hired a flat in Pall Mall for two days specifically to watch the coronation procession of Edward VII. The procession was cancelled due to the King's illness. The flat could still have been used, but its entire purpose was to view the procession.

Rezumatul hotărârii

The Court of Appeal held that the contract to hire the rooms was frustrated by the cancellation of the coronation procession, so Henry was not liable to pay the unpaid balance of the agreed rent. Although the rooms remained physically available and the licence to use them could still have been performed, the parties had contracted on the common footing — evident from the surrounding circumstances, including the way the rooms had been advertised — that the sole purpose of the hire was to view the procession on the two days in question. Cancellation of the procession removed the whole foundation of the contract and made performance something radically different from what the parties had contemplated. Vaughan Williams LJ held that the court must identify the substance of the contract from the surrounding circumstances recognised by both parties; where a supervening event destroys that substance, the contract is discharged. Krell is the leading authority on frustration of purpose and is habitually contrasted with Herne Bay Steam Boat v Hutton.

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