THE LAW OF CONTRACT

The Law of Contract



The Law of Contract

“The enclosures are not effortlessly assured that a granted change of attenuating factors is of adequate gravity to frustrate a contract”

Ans. The courts believe strongly that even if there is a change in the details of a contract the contract should be performed in fullfilment of the tersms. Frustration occurs when the law identifies that without default of either party a contractual obligation has become incapable of being presented because the attenuating factors in which presentation is called for would render it a thing fundamentally different from that which was undertaken by the agreement annoyance should not occur so effortlessly and should be the last rsort move for individuals or organiations.

(b) Fred sprints a plumbing business. He wins a contract with George for the setting up of water systems in a lodgings land parcel being constructed by George. ……………………Advise Fred.

Ans. Referring to the scenario George is liable to Fred for the work he has got done from him and should pay him the price as per the contract details. Despite it being unnecessary to address the other two issues, Lord Hoffman went on to do so. On the question of admissibility of pre-contractual negotiations, Persimmon contended that the true scope of the exclusionary rule

was only to omit pre-contractual discussions where they were “unhelpful” to use the words of Lord Wilberforce

in Prenn v Simmonds. Where instead they revealed a clear pre-contractual consensus on the very issue in issue,

Persimmon contended they were not excluded. Alternatively Persimmon asked for the dwelling of Lords to make a limited

and principled relaxation of the direct to accept pre-contractual material in such cases. (MacQueen, 2005 et. al. Pp. 29.)

The House of Lords unanimously affirmed the exclusionary direct and turned down the proposal that it was restricted in

scontend in the way Persimmon contended. Lord Hoffman giving the leading judgment acknowledged that it would not be

inconsistent with the objective idea of contractual understanding to admit clues of previous communications

between the parties - para [33]. So the rationale for omitting them in all cases is a pragmatic one.

Lord Hoffman then advised the pragmatic causes for the rule.

(1) confessing pre-contractual material is creative of doubt and cost in disputes. It would be essential to

look at the often voluminous pre-contractual material to try to work out what the parties intended and can add

greatly to the extent of litigation.

(2) Pre-contractual material raises problems of its own distinct from other backdrop material. It may be

“drenched in subjectivity” (para [38]) and is often highly contentious.

Experience in the wake of Pepper v Hart in the field of statutory interpretation suggested to Lord Hoffman that admitting pre-contractual material

may boost self-serving declarations in negotiations.

(3) There would be an expanded risk that a third party who took an interest under a agreement would find it meant

something different to what they considered - para [40] - (though Lord Hoffman acknowledged that the difficulty ofa

third party not having get access to to all the applicable interpretative material is inherent ...