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Short title.
Interpretation.
Adjustment
THE HONG KONG GOVERNMENT GAZETTE.
4
(b) for further cases in which an officiating minister should be relieved from penalties notwithstanding that he has been unable to give any certificate under section 7;
(c) generally for carrying this Ordinance into effect. Passed the Legislative Council of Hong Kong, this 16th day of June, 1948.
ALASTAIR TODD,
Deputy Clerk of Councils.
HONG KONG
No. 26 of 1948.
I assent.
L.S.
A. G. GRANTHAM,
Governor.
17th June, 1948.
An Ordinance to amend the law relating to frustration of contracts.
[17th June, 1948.]
BE it enacted by the Governor of Hong Kong, with the advice and consent of the Legislative Council thereof:
1.
This Ordinance may be cited as the Law Reform (Frustrated Contracts) Ordinance, 1948.
2. In this Ordinance—
court" includes any arbitrator by or before whom the matter falls to be determined."
3. (1) Where a contract governed by law applicable to the of rights and Colony has become impossible of performance or been otherwise liabilities of
frustrated, and the parties thereto have for that reason been parties to
discharged from the further performance of the contract, the frustrated
following provisions of this section shall, subject to the provisions contracts.
of section 4 of this Ordinance, have effect in relation thereto.
(2) All sums paid or payable to any party in pursuance of the contract before the time when the parties were so discharged (in this Ordinance referred to as "the time of discharge ") shall, in the case of sums so paid, be recoverable from him as money received by him for the use of the party by whom the sums were paid, and, in the case of sums so payable, cease to be so payable: Provided that, if the party to whom the sums were so paid or payable incurred expenses before the time of discharge in, or for the purpose of, the performance of the contract, the court may,
1.
SUPPLEMENT NO. 1, JUNE 18, 1948.
if it considers it just to do so having regard to all the circumstances of the case, allow him to retain or, as the case may be, recover the whole or any part of the sums so paid or payable, not being an amount in excess of the expenses so incurred.
(3) Where any party to the contract has, by reason of anything done by any other party thereto in, or for the purpose of, the performance of the contract, obtained a valuable benefit (other than a payment of money to which the last foregoing sub-section applies) before the time of discharge, there shall be recoverable from him by the said other party such sum (if any), not exceeding the value of the said benefit to the party obtaining it, as the court considers just, having regard to all the circum- stances of the case and, in particular,-
(a) the amount of any expenses incurred before the time of discharge by the benefited party in, or for the purpose of, the performance of the contract, including any sums paid or payable by him to any other party in pursuance of the contract and retained or recoverable by that party under the last foregoing sub-section; and
(b) the effect, in relation to the said benefit, of the circumstances giving rise to the frustration of the contract.
(4) In estimating, for the purposes of the foregoing provisions of this section, the amount of any expenses incurred by any party to the contract, the court may, without prejudice to the generality of the said provisions, include such sum as appears to be reasonable in respect of overhead expenses and in respect of any work or services performed personally by the said party. (5) In considering whether any sum ought to be recovered or retained under the foregoing provisions of this section by any party to the contract, the court shall not take into account any sums which have, by reason of the circumstances giving rise to the frustration of the contract, become payable to that party under any contract of insurance unless there was an obligation to insure imposed by an express term of the frustrated contract or by or under any enactment.
(6) Where any person has assumed obligations under the contract in consideration of the conferring of a benefit by any other party to the contract upon any other person, whether a party to the contract or not, the court may, if in all the circumstances of the case it considers it just to do so, treat for the purposes of sub-section (3) of this section any benefit so conferred as a benefit obtained by the person who has assumed the obligations as aforesaid.
4. (1) This Ordinance shall save as is hereinafter provided Provision as apply to contracts whether made before or after the commencement to the of this Ordinance, as respects which the time of discharge is on of this
application or after the 8th of December, 1941, but not to contracts as respects Ordinance. which the time of discharge is before the said date.
(2) This Ordinance shall apply to contracts to which the Crown is a party in like manner as to contracts between subjects.