Contracts II, Pages 986–991

Krell v. Henry

Court of King's Bench, 1903

Facts:

Defendant agreed to rent a flat during the daytime for two days for £75 to view the coronation procession of King Edward VII, but the king was diagnosed with appendicitis two days before his coronation, and he was not coronated for another two and a half weeks. Defendant had paid his deposit of £25, but refused to pay the remaining £50 balance.

Procedural History:

Trial court held that there was an implied condition in the contract and gave judgment for defendant.

Issue:

Does the doctrine of impracticability apply when merely the purpose of the contract does not exist?

Rule:

Page 990, Paragraph 2

[F]irst, what, having regard to all the circumstances, was the foundation of the contract? Secondly, was the performance of the contract prevented? Thirdly, was the event which prevented the performance of the contract of such a character that it cannot reasonably be said to have been in the contemplation of the parties at the date of the contract? If all these questions are answered in the affirmative . . . both parties are discharged from further performance of the contract.

Reasoning:

The location of the room needed was based on the coronation procession, and therefore it was foundational to the contract. The coronation did not happen as assumed, and this was of such a character that it cannot be reasonably supposed to have been in the contemplation of the contracting parties when making the contract.

Rule/Holding:

Page 990, Paragraph 3

It is not essential . . . that the direct subject of the contract should perish or fail to be in existence at the date of performance of the contract. It is sufficient if a state of things or condition expressed in the contract and essential to its performance perishes or fails to be in existence at that time.

Judgment:

Affirmed.

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