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This problem is based on frustration of contract.
It is apparent that the destruction of the car by fire frustrated the contract between Mary
and Janet and thereby discharged the parties as neither of them was blameworthy. However,
the deposit of Kshs. 100,000 paid by Mary is recoverable.
My advise to Janet is that there is no cause of alarm as there is no breach of contract.
However, Mary is entitled to the Kshs. 100,000 deposit.
Janet must refund the same.
My advise is based on the provisions of the Law Reform (frustrated contracts) Act 1943
which deal with the adjustment of rights of parties when a contract is frustrated.
Under the Act, when a contract is frustrated any money paid is recoverable.
maurice.mutuku answered the question on April 26, 2018 at 06:43
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