For example, imagine that entrepreneur Emily leases space from landlord Larry so that she can open a restaurant that serves only Tibetan Speckled Lizard meat.
Successful invocations usually come in waves during times of substantial tumult, such as after the passage of Prohibition, when bars and taverns no longer had a reason for their leases, or during major wars, when demand for many consumer goods and services drops far below what is normal.
The English case of Taylor v Caldwell established the doctrine of frustration, alleviating the potential harshness of "sanctity of contract".
Since the contract was impossible to perform, Judge Blackburn held that the absolute liability set forth in Paradine v Jane would not apply here, as there was an implied term that the music hall would be in existence at the date of the planned concerts.
[3] The requirement of "impossibility" in Taylor v Caldwell was modified in the 1903 case of Krell v Henry,[4] which concerned a party who had rented a room for the purpose of watching the coronation procession of Edward VII.
Codelfa Construction Pty Ltd v State Rail Authority of NSW is a pre-eminent case in Australian law of frustration of a contract, applying a tripartite test, namely, an obligation under the contract is incapable of being performed, without fault of either of the parties (e.g., the parties didn't cause the frustrating event to occur), because the circumstances have rendered performance to be radically different.