The Sanctity of Contracts in English Law - College of Social ...

48 Curtailment of Freedom by the CourtsThe following passage from Lord Russell ofKil'owen's speech in Re Badische Co. 20 contains aclear exposition of the doctrine: "The doctrine ofdissolution of a contract by the frustration of itscommercial object rests on an implication arising fromthe presumed common intention of the parties. Ifthe supervening events or circumstances are such thatit is impossible to hold that reasonable men couldhave contemplated that event or those circumstancesand yet have entered into the bargain expressed inthe document, a term should be implied dissolving thecontract upon the happening of the event or circumstances.The dissolution lies not in the choice ofone or other of the parties, but results automaticallyfrom a term of the contract. The term to be impliedmust not be inconsistent with any express term ofthe contract."In at least two types of cases the implied termdoctrine seemed inadequate and restrictive. If thecontracting parties had adverted to the possiblehappening of the frustrating event and had neverthelessdecided to do nothing about it, the implicationof a term was not easily justified. This was madeclear by Lord Wright when delivering the opinion ofthe Judicial Committee of the Privy Council inMaritime National Fish, Ltd. v. Ocean Trawlers,Ltd., 21 when he said: "The authority [of Krell v.Henry 22 ] is certainly not to be extended; it is2 » [1921] 2 Ch. 331, 379.21 [1935] A.C. 524, 529.22 [1903] 2 K.B. 740. In the case of Krell v. Henry thecontract wag for the hire of a window on a particular day.It was not expressly stated in the contract, but was mutually