L.R. 2 K.B. 740 (Ct. App. 1903)
The plaintiff, Paul Krell, sued the defendant, C. S. Henry, for fifty pounds as the balance of seventy-five pounds agreed for the hire of a flat at 56A Pall Mall for the days of June 26 and 27.1 The parties understood that the rooms were to be used to view the coronation processions, and a deposit of twenty-five pounds was paid.2
Subsequently, the defendant saw an announcement that windows to view the coronation processions were to be let.3 He spoke to the housekeeper and agreed to take the suite for the two days.4 On June 20 the defendant sent a letter submitting a cheque for twenty-five pounds as a deposit and asking confirmation that he should have the entire use of the rooms during the days of June 26 and 27, with the balance of fifty pounds to be paid on June 24.5 The plaintiff's solicitor replied confirming the agreement.6
When the coronation processions did not take place on June 26 and 27, the defendant declined to pay the balance of fifty pounds and counterclaimed for the return of his twenty-five pounds deposit on the ground of total failure of consideration.7 Darling J. held that there was an implied condition that the procession should take place and gave judgment for the defendant.8 The plaintiff appealed.9
Whether the agreement for the hire of the rooms at 56A Pall Mall was subject to an implied condition that the coronation processions would take place on June 26 and 27?10
Where, from the nature of the contract, it appears that the parties must from the beginning have known that it could not be fulfilled unless, when the time for the fulfilment of the contract arrived, some particular specified thing continued to exist, so that when entering into the contract they must have contemplated such continued existence as the foundation of what was to be done, the contract is not to be considered a positive contract, but as subject to an implied condition that the parties shall be excused in case, before breach, performance becomes impossible from the perishing of the thing without default of the contractor.11 The English law applies the principle not only to cases where the performance becomes impossible by the cessation of existence of the thing which is the subject-matter of the contract, but also to cases where the event which renders the contract incapable of performance is the cessation or non-existence of an express condition or state of things going to the root of the contract and essential to its performance.12 The condition or state of things need not be expressly specified in the contract if it clearly appears by extrinsic evidence to have been assumed by the parties to be the foundation of the contract.13
Yes. The use of the rooms was let and taken for the purpose of seeing the Royal procession, which was regarded by both contracting parties as the foundation of the contract.14 The rooms had a special character because of their position for viewing the coronation procession, and that character was the foundation of the bargain for both parties.15 The non-happening of the processions prevented performance, and that event could not reasonably be supposed to have been in the contemplation of the parties when the contract was made.16
Accordingly, both parties are discharged from further performance of the contract.17
The agreement for the hire of the rooms at 56A Pall Mall was subject to an implied condition that the coronation processions would take place on June 26 and 27, discharging the defendant from payment of the balance.18