CO129-497 - Public Offices - 1926 — Page 354

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in the former by the shipowner and in the latter by the charterer, and in each case the formal question was whether the refusal could be justified, but there is nothing in Lord Blackburn's language to support the view that the contract does not terminate till a party to it says so. Lord Blackburn himself had said when a party to the judgment in Geipel v. Smith (p. 414),

"It is possible that the blockade might be raised within a reasonable time. If the defendants chose to run the risk and, in the event, turn out right, they are in the same position as if they had waited the reason- able time and had then sailed away," a passage which strongly supports the principle, that it is the event that frustrates, though time may be required in order to appreciate its effect on the con- tract, the event in such a case as the present being requisition for a time inconsistent with the objects of the adventure. Brett, J., puts the principle thus in Jackson's case in the Common Pleas (L.R. 8 C.P. at p. 581): "Where a contract is made with reference to certain anticipated circumstances, and where, without any default of either party, it becomes wholly inapplicable or impossible of application to any such circumstances, it ceases to have any application. It cannot be applied to other circumstances, which could not have been in the contemplation of the parties when the contract was made." When this was affirmed in the Exchequer Chamber (L.R. 10 C.P. at p. 144), Bramwell, B., speaking of the exception of perils of the seas," says: The words are there-- what is their effect? I think this: they excuse the shipowner but give him no right. The charterer has no cause of action but is released from the charter. When I say he is, I think both are." Again, in Bensande v. Thames and Mersey Marine Insurance Co. (1897, A.C. 609), Lord Watson's extempore phrase, "Such delay in the prosecution of her voyage as entitled the charterer to determine the adventure" is explained, partly by the fact that the charterer had done so, and partly by comparing with it Lord Halsbury's language, on p. 611, "It underlies the whole judgment of Collins, J., that the right to insist upon payment of the insurance money, as upon a total loss of the freight, was con- summate at the moment the main shaft broke. Now, there is a fallacy underlying that form of argument, namely, that there must be a sufficiently ascertained form of damage to show at once that the loss must have accrued because the damage was of such a character that it could not be repaired in time. The facts here have been ascertained, and we know why the freight was lost. Why was it? Not simpliciter, but because the main shaft was broken under special circumstances that is, at a distance from any place where it could be repaired within such a time as would have enabled the vessel to prosecute her voyage."

Evidently, therefore, whatever the consequences of the frustra- tion may be upon the conduct of the parties, ita legal effect does not depend on their intention, or their opinions or even knowledge, as to the event, which has brought this about, but on its occur-

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rence under such circumstances as show it to be inconsistent with further prosecution of the adventure. Sometimes the event is such as to speak for itself, like the outbreak of war on the 4th August, 1914, in Horlock v. Beal (per Lord Wrenbury, 1918, 1 A.C. at p. 528). Sometimes the frustration is evident, when the gravity and the circumstances of the breakdown can be known, as in Bensaude's case; sometimes, as in the case of requisition, when it can be known that in all reasonable probability the delay will be prolonged and a fortiori when it has continued so long as to defeat the adventure. Frustration is then complete. It operates auto- matically (Larrinaga's case, 27 Com. Cas. 160). What the parties say and do is only evidence, and not necessarily weighty evidence, of the view to be taken of the event by informed and experienced minds.

one.

Language is occasionally used in the cases which seems to show that frustration is assimilated in the speaker's mind to repudiation or rescission of contracts. The analogy is a false Rescission (except by mutual consent or by a competent Court) is the right of one party, arising upon conduct by the other, by which he intimates his intention to abide by the contract no longer. It is a right to treat the contract as at an end, if he chooses. and to claim damages for its total breach, but it is a right in his option and does not depend in theory on any implied term pro- viding for its exercise, but is given by the law in vindication of a breach. Frustration, on the other hand, is explained in theory as a condition or term of the contract, implied by the law ab initio, in order to supply what the parties would have inserted had the matter occurred to them, on the basis of what is fair and reasonable, having regard to the mutual interests concerned and of the main objects of the contract (see per Lord Watson in Dahl v. Nelson (6 A.C. at p. 59). It is irrespective of the individuals concerned, their temperaments and failings, their interests and circumstances. It is really a device, by which the rules as to absolute contracts are reconciled with a special exception which justice demands.

There is, however, this point of contact between the two cases. Though a party may exercise his right to treat the contract as at an end, as regards obligations de futuro, it remains alive for the purpose of vindicating rights already acquired under

it on either side. So with frustration. Though the contract comes to an end on the happening of the event, rights and wrongs, which have already come into existence remain, and the contract remains too, for the purpose of giving effect to them.

No question of this sort, however, arises here. The contract was wholly executory. The ship was requisitioned before she was placed at the charterers' disposal; the performance of the charter never began, and the failure to begin it by tendering the ship at Singapore was excused in the owners' favour by the excepted Restraints of Princes. Under these circumstances, by the year