The Theoretical Foundation of the English Doctrine of Frustration: Efficiency or Justice?

Abstract

No doctrine of English contract law is as controversial as the doctrine of frustration. Scholars have endeavored to explain or rationalize the doctrine either from the efficiency perspective or from the justice perspective. Neither approach is, however, promising for explaining the current status of the law or guiding meaningful law reforms. The efficiency approach would compel judges to move beyond their familiar charted waters of contract liability rules or may require information judges do not possess during their adjudication. The justice perspective is equally problematic if not more difficult. While the key idea behind private law is corrective justice, the very decision that judges make whether a contract has been frustrated is based on distributive justice. When distributive justice is forced into the private law of contracts, the coherence or rationale of private contract law is gone. This article explains the shaky foundation of the English doctrine of frustration and the unsatisfactory status of the law in this area.