I would please like some legal advice. I am currently trying to get out of a mobile phone contract. I have carried out some legal research into the principle of frustration. I think that my mobile phone company has frustrated my contract as they have told me that they are no longer able to provide me with the unlimited data allowance I was promised when I first signed up to the contract.
They have told me it is not there fault and it is problems related to the airwaves in my area or something of that sort. I told them that they have frustrated the contract that we had in place, by no longer being able to supply me with the unlimited data allowance and therefore I should be able to leave the contract early without having to pay any fines.
However there legal team has come back to be saying that frustration of contract does not apply in this situation as when I agreed to the contract I accepted the risk that this could happen, meaning that frustration of contract does not apply.
I am not sure if they are right or not, can you please explain the limits on frustration of contract?
The Answer from Solicitors Online
The limits on frustration of contract
Frustration of contract is when a contract that has been agreed becomes impossible to fulfill by both parties and consequently becomes void.
(a) Risk Accepted – If either one of the parties to the contract agreed to accept the risk of a specific event taking place that could frustrate the contract, then contract may not become frustrated when the event actually happens.
(b) Self – Induced Frustration – Frustration of contract will not occur when the frustrating event was caused deliberately by one of the parties to the contract.
What is the result of frustration of contract?
When frustration of contract occurs the contract is terminated automatically, but only future obligations in the contract are regarded as being discarded. For contract obligations that have already been fulfilled, the parties will not be entitled to compensation for their related losses.
Law Reform (Frustrated Contracts) Act 1943
The Law Reform (Frustrated Contracts) Act 1943 applies to certain types of contracts and gives parties the right to recover money paid for a contract that has become frustrated.
The Law Reform (Frustrated Contracts) Act 1943 states that any party that has obtained a valuable benefit from a contract before it became frustrated, the value of the benefit should be returned to the other party.
If you need legal advice on frustration of contract, you can speak to one of our Solicitors online right now.