Question

Juanita leased Charlie’s Disco for a series of dances for the Christmas season. A couple of days before the first dance, the Disco was ravaged by a fire of unknown origin.

(a) Advise Juanita if she is bound to pay the agreed amount of the lease.

(b) Would your answer be different if the Disco had burnt down after half of the dances had taken place?

(c) What are the circumstances under which a contract could be frustrated?

Answer 1

Answer) a) No, She is not bound to pay the agreed amount of lease because she is not intentionally backing up from the contract. It is due to an act which they had no control happened, and not the obligations of the contract cannot be performed. So, Juanita is not bound to pay the agreed amount of lease.

b) Yes, if the Disco had burnt down after half of dances had taken place, then Jaunita may be enforced to pay for the dances which had been done in Charlie's Disco as the half part part of the contract was fulfilled.

c) A contract could be frustrated under such circumstances in which the performance of the contractual duties are impossible such as any lockdown, nautral calamity, etc and in which there is no fault of the either party and that it happens after the contract is made. Then a contract would be discharged under frustration.