Mr Krell owned premises on the 3rd floor of 56a Pall Mall. In March 1902, he advertised the premises to let. He put up a sign pointing out that the windows would offer a good view of Edward VII's coronation procession, which was to take place on 26 and 27 June. On 20 June, Mr Henry agreed to let the rooms for 26 and 27 June. The agreement did not state that the premises were hired for any particular purpose. Mr Henry paid a deposit of 25 shillings and agreed to pay a balance of 50 shillings on 24 June. The King fell ill and his coronation was called off (he was eventually crowned in August 1902). Mr Henry refused to pay the remaining 50 shillings. When Mr Krell sued him, Mr Henry counter-sued for a refund of the 25 shilling deposit!
Where is it on the map?
At point I.
Who won?
In the Court of Appeal, Lord Justice Vaughan Williams held that Mr Henry did not have to pay the balance of 50 shillings. But he could not recover the 25 shillings already paid.
What's the principle?
This case illustrates the doctrine of frustration of contract. The Court found that both parties knew the premises were hired for the purposes of watching the procession, even though this was not made explicit in their contract. The coronation was a fundamental part of the contract and its cancellation made the contract impossible to perform. As this was a factor outside of either party's control they were released from their future obligations.
What's it like now?
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This is Quadrant House, at 55-58 Pall Mall. The ground floor is occupied by the Commonwealth Secretariat. The third floor has an ornate balcony, which no doubt gives an excellent view of Pall Mall. The premises are very close to St James' Palace and The Mall. So close in fact, that I bumped into these guys on the way back to the tube:
As for the law, the Law Reform (Frustrated Contracts) Act 1943 modifies the effect of frustration on some types of contract, but Krell v Henry remains good law in some situations.
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