The Doctrine of Frustration And Implied Condition In A Contract: The Court of Appeal
In the case of Krell v Henry  2 KB 740 is an English case which sets forth the doctrine of frustration in contract law. It deals with situations in which a contract’s performance has been frustrating and has become impossible to perform due to any unavoidable reason or condition.
FACTS OF THE CASE:
The defendant, CS Henry, agreed by contract on 20 June 1902, to rent a chamber at Pall Mall from the plaintiff, Paul Krell, for the purpose of watching the coronation procession of Edward VII scheduled for 26 and 27 June 1902. The housekeeper of the premises had informed Henry that he would have an excellent view of the procession from the room. Desiring to secure the rental of Krell’s chamber for the purpose of observing the coronation procession, Henry wrote a letter to Krell’s solicitor in which he agreed to take the chambers for two days. The parties agreed on a price of £75, but nowhere in their written correspondence mentioned the coronation ceremony explicitly. Henry paid a deposit of £25 to Krell for the use of the flat, but when the procession did not take place on the days originally set, on the grounds of the King’s illness, Henry refused to pay the remaining £50. Krell brought suit against Henry to recover the remaining balance of £50, and Henry countersued to recover his deposit in the amount of £25.
The Court of Appeal dismissed the plaintiff’s appeal. Lord Justice Vaughan Williams framed the legal question in this case as whether there was an implied condition to the contract: whether or not while the contract was made, the two parties knew that the reason behind the contract was for Henry to watch the coronation procession. The Court of Appeal observed that Even though there was no mention of this in the written contract, both parties had an understanding of why the defendant was renting the chamber, and the price was fixed with the procession being noted as a prominent factor and therefore, it was implied in the contract that the procession would take place. The only reason why Henry rented the space was to watch the procession and it was his right to watch it. On the other hand, the sole sale to the defendant was of such right as the plaintiff had, and the contract required the plaintiff to part with nothing else. The frustration of the contract declared the contract null and void and released the parties from their contractual responsibilities.
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Reviewed by Anagha K Bharadwaj