Frustration of charter
C1. Commercial shipping, chartering, economics and financeDefinition
Discharge of contract due to supervening events.
Frustration of charter is the automatic discharge of a charter party by operation of law when a supervening event, without the fault of either party, makes performance impossible or radically different from what was agreed. Unlike a force majeure clause, frustration is a common law doctrine that ends the whole contract and is not triggered by mere delay, expense, or a bad bargain; the change must go to the root of the contract. Classic triggers include destruction of the ship, a prolonged detention, or a war that closes the contemplated voyage. On frustration both parties are released from future obligations.
Source: Law Reform (Frustrated Contracts) Act 1943; English doctrine of frustration