“The question whether a contract is discharged by frustration arises when a supervening event, occurring after contract formation, radically changes the nature of contractual performance. However, as was emphasised in the recent decision of Canary Wharf (BP4) T1 Ltd v European Medicines Agency, a contract is not frustrated if risk of the relevant event was assumed under the contract. It is often said that courts adopt a restrictive approach in determining whether a contract has allocated the risk of an otherwise frustrating event; that is to say, the contract text must specifically contemplate the supervening event and it must exhaustively deal with the consequences of that event. Yet the cases demonstrate that a narrow textual focus is not always applied; an assumption of risk is often established from a loose textual foundation or simply by reference to background …”
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Ryan Catterwell, ‘Frustration and assumption of risk’, [2022] Journal of Business Law (1) 76-96.
First posted 2021-11-26 19:00:51
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