The parties contracted to sell a quantity of Mali groundnut expellers cif Rouen. The sellers intended to perform the contracts by appropriating a quantity of Mali groundnut expellers under a contract with suppliers who were the sole producers of the contract goods. Due to an electrical fault and to interruptions in the supply by rail of raw materials, the suppliers were unable to meet their commitments to the sellers who in turn were unable to supply the contract quantity to the buyers.
Held: The appeal failed. The contracts had not been frustrated. It is the seller who can guard against the risk by protecting himself by making his promise conditional on the goods being available for delivery.
Lord Denning MR said: ‘The events were not sufficient to warrant any finding of frustration. There was the breakdown of the machinery at the factory. There was the difficulty in getting raw material down by rail. Such events are commonplace in the world of affairs. If a party desires to avoid such consequences, he must insert a stipulation to excuse him. He cannot avoid them by a plea of frustration.’
Judges:
Lord Denning MR
Citations:
[1978] 2 Lloyds Rep 509
Citing:
Appeal from – Intertradex SA v Lesieur Tourteraux SARL QBD 1977
The court held as frustrated a contract for the sale of Mali groundnuts, where interruptions in elecricity supplies and other faults prevented the sellers from delivering their promise. . .
Cited by:
Cited – CTI Group Inc v Transclear Sa Comc 14-Sep-2007
The parties had contracted for the sale of concrete. The buyers appealed findings by an arbitrator that the contracts were both frustrated for the inability of the seller to complete after the intervention of a company with an effective monopoly, . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 01 May 2022; Ref: scu.259371