Edwinton Commercial Corp v Tsavliris Russ (Worldwide Salvage and Towage) Ltd (The Sea Angel)

Frustration is assessed by a multi factorial approach, taking into account the contract, its context, the parties' knowledge and expectations and the risks allocated.

Citation
[2007] EWCA Civ 547, [2007] 2 Lloyd's Rep 517
Court
Court of Appeal
Year
2007
Subject
Contract Law
Topic
Frustration

Facts

Salvors chartered a ship, the Sea Angel, for a short period to help with a salvage operation after an oil tanker ran aground off Pakistan. The Pakistani authorities detained the Sea Angel for over three months in an attempt to secure payment of claims arising from the oil spill, so the salvors could not return it to the owners at the end of the charter. The salvors argued that the charter was frustrated by the detention, so they did not have to pay hire for the period after the charter ended.

Legal principle

The Court of Appeal held that the charter was not frustrated, so the salvors were liable for the hire. Rix LJ said that frustration should be approached on a multi factorial basis, taking into account the terms of the contract, its matrix or context, the parties' knowledge, expectations, assumptions and contemplations, in particular as to risk, at the time of the contract, and then the nature of the supervening event and the parties' reasonable expectations of performance in the new circumstances. The risk of detention was a known risk in the salvage industry, which the salvors had accepted, and the doctrine of frustration is designed to achieve justice in exceptional cases.

Related cases on frustration

Studying contract law? Our tutors help you understand and apply cases like this in essays, problem questions and exams. Request a quote or browse our law notes.

Back to all law cases

This summary is for study and revision and is not legal advice. Although our case summaries are checked for accuracy, we do not guarantee that they are free from errors or omissions. Always read the full judgment for the court's reasoning.

Contact Us

Enquire about our bespoke academic solutions