The Judicial Committee of the Privy Council held that the frustration in this case was the result of the appellants' own choice of excluding the respondents' ship from the license and, therefore, they were not discharged from the contract. In another similar case, the contract was to export 1500 tons of sugar beet pulp pellets with a further option for the same quantity. The sellers obtained an export license for 3000. They also contracted with another buyer to supply him 1500. But the Government refused to grant any further license. They shipped the whole agreed quantity to the first buyer.
They were now left with the export license for 1500 only, but were under two obligations, one to supply 1500 to the first buyer under the option given to him and other under the contract with the second buyer for the same quantity. As a face-saving device they apportioned the supply between the two buyers giving about half to either. The second buyer…show more content… In H R &. S Sainsbury Ltd v Street : There was the sale of 275 tons (5% more or less) of feed barley to be grown on seller's land. The crop amounted to only 140 tons. The seller resold it to another and contended that he had the right to do so because the contract had ended by frustration. But he was held liable for breach of contract. There was frustration only to the extent of crop failure. The buyer could waive it and claim delivery of whatever little crop the seller's land had produced.
The Supreme Court has laid down that frustration puts an end to the liability to perform the contract. It does not exterminate the contract for all purposes. For example, whether the doctrine of frustration would apply or not has to be decided within the framework of the contract and, if the contract contains an arbitration clause, the arbitrator could decide the matter of