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CONTRACTUAL FRUSTRATION

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Dictum

Frustration occurs wherever the law recognizes that without default of either party, a contractual obligation has become in capable of being performed because the circumstances in which performance is called for would render it radically different from what was undertaken by the contract”. The events which have been listed by the court to constitute frustration are: (1) Subsequent legal changes or statutory impossibility (2) Outbreak of war (3) Destruction of the subject matter of the contract or literal impossibility (4) Government acquisition of the subject matter of the contract. (5) Cancellation by an unexpected event like where other party to a contract for personal service, dies or where either party is permanently incapacitated by ill-health, imprisonment etc., from rendering the service he has undertaken.

– Adekeye JSC. Nwaolisah v. Nwabufoh (2011)

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EXECUTION BECOMING MORE DIFFICULT IS NOT FRUSTRATION IN CONTRACT

A contract is not frustrated merely because its execution becomes more difficult or more expensive that either party originally anticipated and has to be carried out in a manner not envisaged at the time of its negotiation. – Adekeye JSC. Nwaolisah v. Nwabufoh (2011)

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FRUSTRATION OF CONTRACT NEED NOT BE PLEADED

It is also pertinent to underscore that the defence of frustration of contract, like other recognized defenses, need not be specifically pleaded by using the word ‘frustration’ and it is sufficient that the party raising it pleads facts alleging impossibility of performance of a contract and alleges the occurrence of one or more of the above-mentioned events that the Courts have listed as constituting frustration. Additionally, it is the duty of the Court to make the necessary inference from the evidence led whether and when frustration has occurred. In other words, it is the Court that determines the existence of frustration from the facts pleaded and evidence led by the parties.

— S.O. Adeniyi, J. Nwabueze v. ABU Zaria (2023) – NICN/KD/34/2021

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WHEN DOES FRUSTRATION OF CONTRACT OCCURS

As correctly submitted by learned counsel on contending sides, frustration of contract occurs, where after the contract was concluded, events occur which make performance of the contract impossible, illegal or something radically different from that which was in the contemplation of the parties at the time they entered into the contract occurred. In A. G. Cross River State Vs A. G. Federation [2012] 7 SC (Pt 1) 72, the Apex Court listed some events that have been judicially recognized to cause frustration of contract as follows: (a) Subsequent legal changes; (b) Outbreak of war; (c) Destruction of the subject matter of contract; (d) Government requisition of the subject matter of the contract; (e) Cancellation of an expected event. See also NBCI Vs Standard (Nig) Eng. Co Ltd [2002] 8 NWLR (Pt 768) 104; Obayuwana Vs The Governor of Bendel State [1982] 12 SC 147; Okereke Vs Aba North LGA [2014] LPELR-24521(CA).

— S.O. Adeniyi, J. Nwabueze v. ABU Zaria (2023) – NICN/KD/34/2021

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