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Supervenning Impossibility

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89 views6 pages

Supervenning Impossibility

Uploaded by

Showkat Hossain
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Section 56, of the contract act, deals with the impossibility of

performance. “An agreement to do an act impossible in itself is


void.”

An act may become impossible to perform in the following two


ways-

1. Impossibility existing at the time of contract.

2. Subsequent or supervening impossibility. Impossibility which


arises subsequent to the formation of contract

A contract to do an impossible act is void ab initio (void from the


very beginning) but a contract, which was capable of being
performed at the time when it was entered into, but, later it
became unlawful or impossible to perform. In The later one is
known as doctrine of supervening impossibility or doctrine of
frustration.
Frustration occurs where it is established that due to subsequent
change in circumstances, the contract has become impossible to
perform or it has been deprived of its commercial purpose. It is
explained in section 56 para 2 of the Indian Contract Act, 1872.

Salient Features of the Doctrine of Impossibility


a. There must be a valid and existing contract between the parties;
b. There must be some part of the contract yet to be performed;
c. That part of the contract, which is yet to be performed, should become
impossible or unlawful; and
d. That the impossibility should be by reasons of some event which the promisor
could not prevent.

Supervening impossibility may arise in various ways. Some of


them are as follows:

1. Destruction of the subject matter of the contract:


If the subject matter of the contract is destroyed without the fault
of any of the parties, then that particular contract will be
discharged ( unperformable) by doctrine of supervening
impossibility. Because, the contract was capable of being
performed when the parties entered into that contract, but
unfortunately the subject matter of the contract is destroyed
later, which makes the parties unable to perform their contract.
As a result of that, the contract will be discharged.

Case law: Taylor v. Caldwell (1863)


In this case, the plaintiff (Taylor) and the defendant (Caldwell)
entered into a contract to use the defendant’s Music Hall, by the
plaintiff, on four certain days. But unfortunately, after the contract
was signed the music hall was accidently destroyed by fire, even
without the fault of any of the parties.

It was held that the defendant is discharged from liability to let


the music hall as promised. This makes the contract void and it
was discharged by the doctrine of supervening impossibility.
2) Change of law:

If any change in the laws occurs and the change in law makes the
contractual act unlawful, then the performance of the contract
becomes unlawful. In those cases, the original contract becomes
void.

For example, if there was a contract with regard to the export of


rice from one particular state to another. However, the
government subsequently made some restrictions on the export
of rice and as a result of that, the contract is discharged by the
doctrine of supervening impossibility which is occurred through a
change in the law.

3} Non- concurrence of circumstances:


If the parties entered into contract on the basis of a particular
state of things, the contract becomes discharged if the state of
things changes

For example:

X and Y had made a contract to get married on 27 January 2022.


But before the date of marriage, on 27 December 2021, Y goes
mad. So, in such condition, the contract becomes void.

4} Death or incapacity for personal services:


If the performance of the contract depends upon a person’s
personal skills or a party’s qualification, the contract becomes
discharged is that person dies, or becomes ill, before the
performance of the contract.

Case law: Robinson v. Davison (1871)


In this case, there was a contract between the plaintiff and the
defendant’s wife. The defendant’s wife was a great singer and
their contract was that she should sing at a concert organised by
the plaintiff. But, on the day of the event, the defendant’s wife got
ill and she was not in a condition to sing at that particular concert.
As a result of that, the plaintiff had suffered a great loss and he
sued her for the breach of contract.

But the petition got failed due to the frustration of the contract.

5} Outbreak of war:
A contract which is entered into with an enemy during the time of
war is void ab initio. So, if a person of Ukrane has entered into a
contract with a citizen of russia, it becomes void and unlawful
when a war is declared between the two country.

Cases in which there is no Supervening Impossibility


i. The mere fact that performance is more difficult or expensive than the parties
expected does not frustrates the contract.
ii. Performance cannot be excused on the ground of commercial impossibility. A
contract, therefore, is not discharged for frustration merely because
expectation of higher profit is not realized; or the necessary raw material is
available at very high price.
iii. Strikes, lockouts and civil disturbance like riots do not terminate contracts
unless there is clause in the contract providing for or performance in such
cases.

Iv] Self-induced impossibility: When the impossibility is due to the fault of


any of the parties, the doctrine does not apply. For instance, A, a lorry owner
promises to B that he will give him his lorry for hire. However, he had to
renew his lorry’s licence, which he failed to do so. He cannot avoid the
contract since the licence has not been renewed due to his own actions.

V] Failure of a third party: If the promisor relied on a third party for


performing his obligation, the contract does not become discharged merely
due to the default of the third party. For instance, A and B enter into an
agreement where A promises to sell him a specific quantity of cotton goods
to be manufactured by a specific mill. The contract also had a condition
regarding the time of delivery. The mill failed to produce the cotton goods. As
a result, A could not perform his obligation. B can recover compensation from
A for the losses incurred due to his failure.

Effects of Supervening Impossibility:


i. Contract becomes void.
ii. Restoration or refund of benefit received.
iii. Innocent promisee entitled to compensation.

Force Majeure, COVID-19 and Act of God

The term “Force Majeure” is a French word which literally means “Greater
Force” we can also called it as “An act of god”. In short, these are
situations which are outside the control of the parties and protects the
parties from being liable for its failure to perform their obligations under the
contract.

It mainly covers earthquake, volcanoes, drought, floods and other natural


calamities and sometimes covers any endemic or pandemic

The term “Force Majeure” is not defined anywhere but it derives its
reference from section 32 of the “ Contract Act, 1872”.

For Example- Sunil contracts to pay Bunty a sum of money when Bunty
marries Chandani. Chandani dies without being married to Bunty. The
contract becomes void and impossible to perform under these circumstances
Sunil is under no obligations to pay Bunty.

Section 56 simply says that to do any act after the contract is made,
becomes impossible due to some unforeseen event which cannot be
prevented by any means becomes void.
But force majeure specifically means acts of god or nature
that are beyond human control and which are unpredictable.

The doctrine of Force Majeure is often overlapped with the doctrine of frustration
of contract or impossibility to perform. Unlike Force Majeure clause which is
typically in the form of a contractual provision, frustration of contract or
impossibility to perform is statutorily provided under Section 56 of the Contract
Act. Therefore, if the contract does not expressly or impliedly contain
exemptions for non-performance in the nature of Force Majeure, a party seeking
to set up a defense dehors the contract can place reliance on Section 56 of
Contract Act.

Conclusion
Section 56 of the Indian Contract Act, 1872 deals with provisions
relating to the impossibility of performance of the contract. The
doctrine of supervening impossibility, simply means that a
contract was capable of being performed at the time when it was
entered into, but later due to some circumstances the
performance of the contract becomes impossible. Some of the
circumstances by which the performance of the contract becomes
impossible are the destruction of the subject matter, change of
law, death of the party to the contract and outbreak of war.

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