National Carriers Ltd v Panalpina (Northern) Ltd: HL 11 Dec 1980

No Frustration of Lease through loss of access

The tenant’s access to the premises was closed by the local authority because it passed by a derelict and dangerous building. The tenant argued that its tenancy was frustrated.
Held: The lease was not frustrated. The lease had a term of ten years, and the interruption was temporary. The doctrine of frustration was developed as an expedient to escape from injustice and is a modern and flexible doctrine not constricted by any arbitrary formula. ‘Frustration of a contract takes place where there supervenes an event (without default of either party and for which the contract makes no sufficient provision) which so significantly changes the nature (not merely the expense or onerousness) of the outstanding contractual rights and/or obligations from what the parties could reasonably have contemplated at the time of its execution that it would be unjust to hold them to the literal sense of its stipulations in the new circumstances; in such case the law declares both parties to be discharged from further performance.’

Lord Hailsham of St Marylebone LC, Lord Wilberforce, Lord Simon of Glaisdale, Lord Russell of Killowen, Lord Roskill
[1981] AC 675, [1980] UKHL 8, [1981] 1 All ER 161
England and Wales
CitedCricklewood Property and Investment Trust Ltd v Leighton’s Investment Trust Ltd HL 1945
Wartime regulations were implemented which prohibited the building on land which was already subject to a building lease which required the lessees to erect several shops.
Held: Even if the doctrine of frustration could apply to a lease, the . .
CitedParadine v Jane KBD 26-Mar-1647
The defendant tenant had had his house occupied by an invading army and he sought to be excused from paying rent.
Held: ‘where the law creates a duty or charge, and the party is disabled to perform it without any default in him, and hath no . .
CitedTaylor and Another v Caldwell and Another QBD 6-May-1863
The defendants had agreed to hire a hall to give four concerts, but it burned down before they were to start.
Held: Blackburn J said: ‘where, from the nature of the contract, it appears that the parties must from the beginning have known that . .
CitedJackson v Union Marine Insurance Co Ltd CCP 1874
The plaintiff ship owner, contracted under a charterparty to proceed with all possible dispatch to Newport. He insured the cargo. The ship ran aground before the cargo could be collected, and was delayed. The charterers threw up the charterparty and . .
CitedEmbiricos v Sydney Reid and Co 1914
What constitutes a frustrating event something to be ascertained only at the time when the parties to the contract are called on to make up their minds. . .
CitedDenny, Mott and Dickson Ltd v James B Fraser and Co Ltd 1944
. .
CitedW J Tatem Ltd v Gamboa 1939
The court considered a charterparty of one month’s duration, at a very high rate of freight, limited to trade from the northern ports in the hands of the Republican Government of Spain to ports in France and which made plain that the specific . .
CitedHirji Mulji v Cheong Yue Steamship Co Ltd 1926
Lord Sumner considered the doctrine of frustration, formulating it as a ‘device by which the rules as to absolute contracts are reconciled with a special exception which justice demands.’ . .
CitedTamplin Steamship Co Ltd v Anglo Mexican Petroleum Co 1916
Lord Loreburn formulated the doctrine of frustration as based on the answer to the question: ‘What in fact is the true meaning of the contract?’ . .
ApprovedDavis Contractors Ltd v Fareham Urban District Council HL 19-Apr-1956
Effect of Contract Frustration
The defendant appellants contended that their construction contract was frustrated because adequate supplies of labour were not available to it because of the war.
Held: The court considered how the frustration of the performance of a contract . .
CitedTsakiroglou and Co Ltd v Noblee Thorl GmbH HL 1961
The arbitrator had determined a mixed question as to whether a c.i.f. contract had been frustrated.
Held: A mixed finding of fact and law by an arbitrator is open to review by a court. Though in the ultimate analysis whether a contract was . .

Cited by:
CitedBAS Capital Funding Corporation, Deutsche Bank Ag London, Paine Webber Capital Inc, PW Exe Lp, Pw Partners 1999 Lp v Medfinco Limited, Abacus Holdings Limited, Andreas W Gerdes, HTC Inc, etc ChD 25-Jul-2003
The claimants wanted to bring actions in respect of various matters under shareholders agreements in complex international joint ventures. Leave was given to serve English proceedings in Malta, and the claim form and particulars of claim were faxed . .
CitedVerner, Sheppard, Ridley v Derby City Council, Norfolk County Council, St Thomas More Roman Catholic High School QBD 14-Nov-2003
The question was whether, when a teacher has applied for and accepted ill-health retirement benefit, usually a lump sum and a pension, on the ground of permanent incapacity, there exists a public law duty on his employer to dismiss the employee.
CitedGraves v Graves and others CA 3-Jul-2007
The parties had divorced and settled financial provision, but the former wife and her children came to need a house and one of the claimant’s properties became vacant, and she was allowed to occupy it as a tenant, with the majority of the rent being . .
CitedHussain v Mehlman CC 5-Mar-1992
(County Court) The defendant landlord granted the plaintiff a three year assured shorthold tenancy. He now appealed a finding that he was in breach of an implied covenant to maintain the space heating, and otherwise. The tenant had returned the . .
CitedReichman and Another v Beveridge CA 13-Dec-2006
The defendants were tenants of the claimant. They vacated the premises and stopped paying the rent. The claimant sought payment of the arrears of rent. The defendants said that the claimants should have taken steps to reduce their damages by seeking . .
CitedGold Group Properties Ltd v BDW Trading Ltd TCC 3-Mar-2010
The parties had contracted for the construction of an estate of houses and flats to be followed by the interim purchase by the defendants. The defendants argued that the slump in land prices frustrated the contract and that they should not be called . .
CitedStar Energy Weald Basin Ltd and Another v Bocardo Sa SC 28-Jul-2010
The defendant had obtained a licence to extract oil from its land. In order to do so it had to drill out and deep under the Bocardo’s land. No damage at all was caused to B’s land at or near the surface. B claimed in trespass for damages. It now . .
CitedMr H TV Ltd v ITV2 Ltd ComC 8-Oct-2015
The claimant had contracted with the defendant for the production of a series of reality TV shows featuring celebrities. After severe personal clashes between the people involved on the claimants side, the contract was terminated. The claim was that . .
CitedJohn Lewis Properties PLC v Viscount Chelsea ChD 1993
Three Leases of the Peter Jones site to T’s predecessor in 1934 contained covenants by T to redevelop the site in two phases, the second of which related to the MackMurdo and Simon’s Street buildings and was to be completed by December 25 1987. In . .

Lists of cited by and citing cases may be incomplete.

Contract, Landlord and Tenant

Leading Case

Updated: 11 November 2021; Ref: scu.186472