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GREGORY ABRAMS DAVIDSON SOLICITORS
For you, for business, for life.
The COVID-19 pandemic has transformed our lives drastically in many ways, not least by creating unpredictability and previously unforeseen (and unforeseeable) circumstances such as large-scale shutdown of society, closures, curfews and other restrictions.
This has led to many parties considering whether or not their contract has become “frustrated”.
Frustration is a doctrine that has evolved over a long period of time.
Initially, it was considered to be an implied term within a contract (Taylor v Caldwell (1863) 3 B&S 826). However, it is now understood as a rule of law, imposed upon the parties in the pursuit of justice and fairness.
Frustration occurs when what is known as a “supervening event” (i.e. an event occurring after the contract has been signed) causes a contract to be “impossible, illegal or radically different”.
The answer to the question as to whether one’s particular contractual circumstances amount to a “Frustration” is a matter of critical and factual analysis.
Please note that a contract which renders performance to be more onerous, for example being more difficult or more expensive, does not amount to frustration (David Contractors v Fareham UDC [1956] AC 696).
The courts will take a multifactorial approach when deciding if a contract has been frustrated. To name a few of the factors considered:
Upon the determination of frustration of a contract, the obligations imposed on the parties in the contract disappear.
The approach has changed over time to provide a more equitable result for the parties involved.
The Law Reform (Frustrated Contracts) Act 1943 now regulates contracts which have been frustrated with directions on repayable sums and dealing with other benefits which are not monies. However, the courts powers are very limited, they can only apportion windfall gains/benefits but not losses, losses are not to be investigated or redistributed.
The impact of COVID-19 – and specifically, the potential short term life of future “shotgun lockdowns” where we are forced by law to cancel our arrangements and stay at home until lockdown is lifted – is likely to make the doctrine of frustration only more commonplace. It will no doubt become part of the commercial vernacular as contractual obligations become radically different, impossible or even illegal!
We are experts in commercial and corporate law, including dispute resolution.
We have been advising our clients on contractual and litigation issues such as “frustration” for over 40 years and since the start of the Covid-19 pandemic, we have successfully navigated our clients across difficult and onerous contractual landscapes which, without our input, would have had catastrophic financial consequences.
Should you or your business require assistance with commercial contracts or litigation matters, please contact us to discuss in confidence on a no obligation basis.
Please feel free to contact us to discuss with no obligations 0808 168 5457, email us at [email protected] or fill out our online enquiry form.
Liverpool City Centre: 20/24 Mathew Street, Liverpool L2 6RE
Liverpool – Penny Lane: 123 Penny Lane, Liverpool, L18 1DF
London – North West: 746 Finchley Road, Temple Fortune, Golders Green, London, NW11 7TH
Whilst our solicitors are based in one location, we are always happy to try to make an appointment to meet you in any of our office locations, if this is more convenient for you.
© 2025 Gregory Abrams Davidson Solicitors
Gregory Abrams Davidson Solicitors and GAD Commercial are trading names of National Law Partners Limited, registered in England and Wales under number 08312439 and are Authorised and Regulated by the Solicitors Regulation Authority, under number 646548. Gregory Abrams Davidson Solicitors registered office: 20-24 Mathew Street, Liverpool, L2 6RE. VAT Registration Number: 290 6677 68.