Multiple Case Analysis – Frustration Folia v. Trelinski, Doucette v. Jones, and Cowie v. Great Blue Heron Charity Casino are legal cases that deal with what constitutes the frustration of a contract. These cases are crucial with regards to clarifying frustration within a business transaction and employer-employee relations, and present consistent interpretations to determine whether a contact has been frustrated.
Case 1: Folia v. Trelinski – [1997] B. C. J. No. 2417, 36 B. L. R. (2d) 108, 32 R. F. L. (4th) 209, 14 R. P. R. (3d) 5, 74 A. C. W. S. (3d) 952 Juliana Folia (The Plaintiff) transferred property to Maria and Hubert Trelinski (The Defendants), her daughter and son-in-law. In exchange, the defendants promised the plaintiff could live with them, with the provision of food and care. Eventually, the defendants stopped providing her with food and asked the plaintiff to leave the house. When the case was brought forward in court, there was uncertainty with regards to the validity of the agreement. The judge then concluded that the agreement was enforceable. The defendants thus acknowledged the contract, but contended it was frustrated by means of the parties’ inability to live together.
For a contract to be frustrated, it must e different from what the parties had intended. The change must completely affect the nature, purpose, effect and consequences of the contract for both parties, and must have brought unforeseeable and radical change. The judge concluded that no authority was cited indicating the strained relationship between the plaintiff and defendant. The contract was not impossible to perform. The hardship and inconvenience are not valid grounds for the defendants to go back on their promise to care for the plaintiff. Therefore, the contract was not frustrated.
Case 2: Doucette v. Jones – [2006] N. B. J. No. 225, [2006] A. N. -B. no 225, 2006 NBCA 38, 299 N. B. R. (2d) 288, 18 B. L. R. (4th) 185, 24 E. T. R. (3d) 167, 148 A. C. W. S. (3d) 640, 2006 CarswellNB 297 Doucette (The Appellant) appealed the decision for dismissal of action for performance of the respondent’s agreement to transfer a snow-crab license. Jones (The Respondent) sold his snow-crab license and entire business to the appellants for $1. 5 million. Everything but $11,000 of the purchase price was paid and the license was not transferred.
The appellants’ action was dismissed because the transfer of the license was frustrated hen it was denied by the Minister of Fisheries and Oceans. He appealed on the basis that the trial judge misapplied the law of contractual frustration and the respondent breached his contractual and fiduciary obligations from the agreement. The parties are frustrated when the agreement they had is no longer attainable. Literal performance may still be possible, but it cannot fulfill the original intentions of the parties.
The DFO (Department of Fisheries and Oceans) revoked the respondent’s request to re-issue the license because he was no longer head of the enterprise he sold to the appellant. The DFO exercised their ministerial discretion and enforced policy. Therefore, Frustration occurred before the Jones could apply for the re- issuance of the license to the Doucette, a direct result from the sale of the business to Doucette. The cases of Folia v. Trelinski and Doucette v. Jones both dealt with transactions, and the impossibility or frustration of specific performance.
In Folia v. Trelinski, Folia transferred her property to Trelinski in exchange for the provision of food and care. The parties were unable to live together, citing difficulty in the performance of the contract. In Doucette v. Jones, the transfer/re-issuance of the license was frustrated when the Department of Fisheries and Oceans denied the transfer. Considering this was an unforeseeable event, this constituted frustration.
The difference between these two cases is the government regulation of the DFO. Case 3: Cowie v. Great Blue Heron Charity Casino – [2011] O. J. No. 573, 2001 ONSC 6357, [2012] CLLC para 210-010 In this case, the defendant, Great Blue Heron Charity Casino (The Appellant) is appealing a judgment requiring them to pay the plaintiff, Cowie, damages for wrongful dismissal. Cowie was hired by the Casino as a security officer. As of 2008, the plaintiff was required to obtain a security guard license under the PSISA. The plaintiff was not eligible for this license due to a conviction for breaking and entering and was not pardoned. The defendant notified the plaintiff that his employment would be terminated due to frustration of the employment contract.
The plaintiff sued for wrongful dismissal and won, with the trial judge noting that the plaintiff obtained a pardon four months later, and could have fulfilled the requirements had he been suspended. The efendant is now appealing that the trial judge misconstrued the law related to frustration. The trial judge placed emphasis on post termination events that had no bearing on the doctrine of frustration. For a contract to be frustrated, it must be totally different from what the parties had intended. The disruption must be permanent, not temporary or transient.
The contract between Cowie and his employer was based upon the implicit understanding that he could perform his job in compliance with the law. The contract would become radically different if he was still employed but was prohibited by the law from working. The new licensing under the PSISA was an unforeseen circumstance by both parties and made it illegal for the plaintiff to continue working. Therefore, the contract was frustrated because it was illegal for Cowie to perform his job. The cases of Doucette v. Jones and Cowie v.
Great Blue Heron Charity Casino were both influenced by government law and restriction. In Doucette v. Jones, the Department of Fisheries and Oceans enforced their policies on the re-issuance of licenses. Due to the enforcement of policy, the contract between Doucette and Jones was frustrated. In a similar manner, Cowie v. Great Blue Heron Charity Casino was based on the unforeseen addition the new PSISA licensing initiative. The PSISA had a clear mandate that made it illegal for Cowie to be employed without the pardon and subsequent license.
Furthermore, the pardon and license were discretionary, and would only be granted based on the prudence of the PSISA and Parole Board. In conclusion, all three cases were consistent in the interpretation and analysis of what constitutes the frustration of a contract. The judge ruling in each case derived a similar explanation for the doctrine; frustration occurs when the agreement between two parties radically hange due to unforeseeable circumstances. Each individual case dealt with frustration in different situations. Folia v.
Trelinski was a domestic case. The judge concluded that a strained relationship and difficulty in the performance of the contract was not enough to constitute frustration. Doucette v. Jones dealt with business transactions and specific performance. It further illustrates that frustration occurs when the agreement between parties is no longer achievable, even if performance is still possible. Cowie v. Great Blue Heron Charity Casino considered the frustration of a contract between an employer nd employee, and the illegality in employment contracts.
When illegality radically changes the terms of a contract, it provides grounds for employers to terminate that contract based on frustration. Although the interpretation of frustration remained consistent between each case, the reasoning evolved depending on the circumstances. In comparison with Folia v. Trelinski, the Doucette v. Jones and Cowie v. Great Blue Heron Charity Casino cases best exemplified the frustration of a contract within a business context. It showed how government regulations play an important role in the performance and frustration of a contract.
