Sure Can Trust Ltd - Case Study

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On the other hand, Able Pte Ltd could contend for frustration of contract termination due to impossibility. On the facts, Able Pte Ltd could claim that because of its commitments, it is unable to complete Oh Noh’s renovations and fulfilment of the contract may become impossible. However, all these are brought about because of the conduct of one of the parties, in this case, the party would be Able Pte Ltd. This is considered a self-induced frustration. After the hacking had started, the company realizes there is no way it can finish on time, as it has over committed itself by doing many other renovations in many other places at the same time. The failure of performing the contract by the timeline was induced by Able Pte Ltd’s own decisions of signing several contracts with other customers. Moreover, Able Pte Ltd decided to discontinue the performance of contract, as it was the least profitable contract comparing to others. This reveals that Able Pte Ltd could have reassigned its labours to perform renovations work to Oh Noh’s house in order to fulfil the contract obligations. However, it chose not to so that they could earn more profits from other contracts. Therefore, it is a self-induced act and it is unlikely the doctrine of frustration would apply. This principle is supported by case law Maritime National Fish Ltd v Ocean Trawlers Ltd (1935) where the appellants who had three out of five licenses refused to assign the license to the vessels chartered from the respondents and alleged that their contract was frustrated when in fact it was self-induced. The court held that frustration cannot be successfully raised.

Hence, Able Pte Ltd cannot be excused by reason of frustration if it does not perform the contract.

- If 2 months have passed and no further work has been done, despite Mr Oh Noh’s repeated calls – what are Mr Oh Noh’s rights?

The issue is whether Mr Oh Noh can have any rights over Able Pte Ltd despite the fact that Able Pte Ltd is not answering Mr Oh Noh’s repeated calls for two months.

Mr Oh Noh’s rights will depend on whether there has been a breach, and the form of breach that is formed. Subjecting on the agreed time of completion of the project in the contract, there may be repudiatory or fundamental breach of contract.

Repudiation occurs when one party by words or action intimates to the other that he no longer intends to go ahead with or be bound by the contract. There are two forms of repudiation - anticipatory, when the date for performance is yet to be due, and actual, when the date for performance is due.

Fundamental breach occurs when there is a breach of a condition, a very important or fundamental term. If there is a repudiatory or fundamental breach, the innocent party can choose to either terminate the contract or affirm the contract, and sue for damages incurred.

According to the facts, if the contract period of completion is more than 2 months, for example three months, then Mr Oh Noh may argue that there is anticipatory repudiation of contract. Mr Oh Noh may argue that it is not feasible for Able Pte Ltd to complete the project in another month. Hence, by stopping work Able Pte Ltd has indicated that it intends to drop the project.

On the other hand, Mr Oh Noh may contend that the discontinuing performance of contract and disregards of Mr Oh Noh’s repeated calls express the absence of interest in completing the project and it does not intend to be bound by the contract. Mr Oh Noh may institute an action and bring Able to court immediately if he wishes, without to wait until three months long.

If the court hold that it could be an anticipatory repudiation, Mr Oh Noh can terminate the contract and seek for losses Able Pte Ltd has incurred. Recoverable losses include the two months of rental Mr Oh Noh has to pay, assuming he is currently renting another place to live in while his house is under renovation.

Assuming that the time of completion stated in the contract is less than two months, Mr Oh Noh may claim that there is an actual repudiation of contract, on the grounds that Able Pte Ltd has not performed its contractual obligations for the renovation of the house within the deadline. Hence, Mr Oh Noh has the right to institute an action on whether to terminate the contract, or affirm the contract, and sue for losses incurred.

Moreover, this assumptions allows Mr Oh Noh to bring an action against Able Pte Ltd on the basis a fundamental breach of contract by Able Pte Ltd if Able Pte Ltd did not complete the renovation within two months’ time. If completing the renovation in time is proven to be a condition, Mr Oh Noh can choose to terminate the contract, or to affirm the contract, and sue for losses incurred.

Nonetheless, Mr Oh Noh may also choose to affirm the contract that it will benefit him more if Able Pte Ltd were to perform the contract. For instance, Able Pte Ltd might have offered him renovation rates that are much lower than the market rates. Though Mr Oh Noh may have affirmed the contract, he may still sue Able later for the losses he suffered.

However, failure to act does not certainly amount to an anticipatory repudiation. There may be possibility that Able Pte Ltd may resume the renovation once there are sufficient labours to carry out and complete the contract by the agreed date. If Able can justify before the court that there was no anticipatory repudiatory breach, while Mr Oh Noh can sue Able for the losses he has suffered for the 2 months delay, Able can in turn sue Mr Oh Noh for wrongful eviction.

- What are Mr Oh Noh’s remedies if he decides to sue?

The issue is whether Mr Oh Noh’s are able to seek for remedies if he decides to sue Able Pte Ltd. If yes, the issue will be of type of remedies that Mr Oh Noh’s would be entitled to.

Remedies typically arise from the suing of another party for breach of contract. The common remedies include Damages, Specific Performance and Injunctions.

Damages maybe unliquidated or liquidated. Unliquidated damages refer to damages that have not been pre-agreed to by the parties in the contract and are thus damages that are awarded or determined by the court.

On the facts, there were no pre-agreed terms mentioned in the contract. If Mr Oh Noh decides to sue, he can seek for unliquidated damages for any losses incurred due to the stalled renovation project by Able Pte Ltd. Besides, it is known that Able Pte Ltd completely stop the projects as there are more lucrative renovation projects. This means that they might have profited significantly from other projects by discontinuing