Peter Cane Essay Competition Answer

My answer to the 2025 Peter Cane Legal Reasoning competition

Hello everyone, for this week’s issue of More About Law I am going to provide you with my answer from Oxford’s Peter Cane essay competition. With a deadline ending at the beginning of this month I am now able to post my own essay response online. For reference to the question itself please see their website at: https://www.ccc.ox.ac.uk/sites/default/files/peter_cane_legal_reasoning_prize_2025.pdf and hopefully Substack will allow you to view this file.

I found the question itself extremely interesting, based entirely on the frustration of contracts and Section 1 of the Law Reforms Act 1943. The case in question was to do with Amber (an entertainment organiser) hiring a boat from Boats Co in order to view the King’s Coronation. The date of the Coronation was moved the day before the event was supposed to take place, thus frustrating the contract. Nevertheless, Boats Co spent money on renovating their ship; this raises the issue of whether or not Amber has to provide Boats Co with compensation. With such a subjective question, Oxford truly provided something interesting and easy to write about.

My response can be found below:

How does Section 1 of the Law Reform Act 1943 apply to Amber and Boats Co?

Section 1 of the Law Reform Act 1943 manages to focus upon key issues surrounding the frustration of contract law, nevertheless, coincidingly with other areas of law it lacks the certainty necessary in order to have a clear outcome of every case. For instance, the contract was in fact frustrated; the Coronation was cancelled, Boats Co had paid for the renovations, and Amber was yet to pay her fee decided upon by the specific date. On June 1^st, Amber did not pay the original fee that was agreed, thus placing a great deal of difficulty within this case; if the fee was paid, it would be most likely that Amber would get a great proportion of it paid back to her. This was not the case. Due to Amber’s ambivalence with the contract, she breached the terms already discussed and agreed upon, thus leading to a deal of subjectiveness now brought upon this case.

An important viewpoint to take is that Amber may argue that she did not request for Boats Co to renovate a ship, she simply asked for a ‘suitable vessel’ for her passenger count. Therefore, it is safe to say that the £15000 total renovation cost for Boats Co was not required or mentioned within the contract. Of course, Boats Co may have not been in possession of a suitable substitute for this renovated boat, but the case lacks any mention of Boats Co needing to renovate this boat instead of using another. So, is it fair to say that these changes were made purely for this specific contract? Perhaps, nevertheless, there is almost no debate for the fact that Boats Co will benefit from these changes in the future. Therefore, in my judgment for whether or not Amber will have to pay the outstanding sum I will not include any relation to these payments; their relevance to the case being minimal. Note that this is in compliance with my previous statement of the level of necessity of Boats Co’s renovations. This is a relatively strong argument, nevertheless, it is easily overcome if Boats Co have evidence to suggest that they truly did not have a suitable substitute for the ‘Salty Sea’.

Assuming that Amber had paid the £25000 sum on June the 1^st, S1(1) LRA 1943 supports that she would have received the whole sum back from Boats Co. Nevertheless, Amber did not pay these funds in the time that was agreed, furthermore, regardless of the renovations made, Boats Co would have had the ‘Salty Sea’ out of action until the day after the Coronation. This decision was made in accordance with the contract formed, assuming that they would receive the £25000 sum. Thus, letting us assume that Boats Co would have missed out on business during the time, leading to possible compensation needed. This £25000 was a guarantee of their contract, with the 10% of profits only being a possible addition. Amber acted outside of the contract, with her payment not being made, not only being a tort, but also aiding Boats Co in their possible payments received from this action. Boats Co could argue that this loss of business actually outstrips the £25000 sum, outshining the possible benefits from the ‘Salty Sea’s’ renovations. Consequently, regardless to all other factors against Boats Co, had the £25000 payment been paid on time, it would have gone towards covering their lost revenue, thus making the payable no longer payable, instead reinvested within the company. In this extreme scenario, Amber would be unable to receive any of the £25000 back.

Therefore, it could be said that Amber’s negligence towards her statements made in the contract should lead towards her paying Boats Co at least £20000 out of the original £25000 promised. This is due to the fact that although the contract was frustrated due to the King’s illness, the lost business of Boats Co remains the most impactful point. This £20000 sum doesn’t involve any relation to the £15000 renovation cost, instead it is simply due to the fact that the contract caused them to be unable to rent out the ‘Salty Sea’ until the event date, due to preparation and to ensure that it didn’t get damaged. Boats Co’s actions were made upon the supposed guaranteed £25000 payment: with Amber lacking to make this payment on the agreed date thus placing their position within the prospects of case law. This decision is supported by Gamerco SA v ICM, where the judge had ‘Broad Discretion’ on the matter, deciding to act as if following the ‘Total retention’ claim, judging that perhaps the payment went unpaid in order for the party protect themselves against insolvency. This is equally mirrored with our case due to Amber’s unpaid sum, making it extremely relevant.

When considering Clause C of the contract, it states that Amber must arrange to install a new speaker system to the vessel. There are two possible outlooks, one of which assumes that Boats Co’s renovations were necessary in order for them to complete the contract, and the other assumes that the renovations were not needed, simply an action more appropriate for the firm and their future business.

When considering the first outlook, the points are altered. Amber did not pay the required amount in time, nevertheless, she installed the speaker system, and Boats Co began their renovations of the ‘Salty Sea’. Amber’s installation of the speaker system acted as an incentive for Boats Co to carry on with their activities, providing confirmation that Amber would stay loyal to their agreements. If Boats Co did not have a suitable substitute ship for Amber’s demands, then they may argue that the £15000 fee was in fact necessary for the contract to be carried forward, thus making that fee extremely relevant. This fee was paid according to the ‘guaranteed’ £25000 sum from Amber, if the original fee was paid on time, then Boats Co would have to return £10000 of the payment, allowing all possible payables to be returned. Nevertheless, the payment was not sent when originally planned, therefore casting doubt upon the matter. Furthermore, Amber may state that the speaker system provides Boats Co with a non-monetary benefit for their future business – allowing them to expand their brand. There was no apparent reason for Boats Co to receive any less than £15000 from Amber, thus covering the funds which Boats Co had spent. More than this sum could be further justified due to the fact that Amber acted with bad faith towards Boats Co, as well as their lost business. Nevertheless, the speaker systems provide Boats Co with a reasonable benefit from the contract regardless of its frustration; thus making £15000 a reasonable and fair fee.

When considering the second point, once again the points change. The contract was running smoothly up until the King’s illness, with the only downside being Amber’s unpaid fee. Amber was legally obliged to pay this fee, meaning that it will eventually be transferred. If we assume that Boats Co had a suitable substitute boat for Amber’s demands then their £15000 renovation fee was not required for the contract, therefore any fees spent will not be relevant to this scenario (the renovation itself may have even benefitted Boats Co). Furthermore, Boats Co’s newly renovated ship also gained the benefit of the speaker system, perhaps the reason why Boats Co decided to choose the ‘Salty Sea’ in particular. We can assume henceforth that Boats Co did not spend the renovation sum as a response to the guaranteed £25000. This will lead to a juxtaposing scenario, involving Amber retaining the £25000 sum, due to the fact that Boats Co benefitted from the contract regardless of whether or not the £25000 sum was paid. Although rather immoral, I believe that as this £25000 was not reinvested into anything directly involving the contract, that the payable fee remains payable (in accordance with S1(1) LRA 1943), and that the speaker system, the now unpayable fee, acted as a benefit for Boats Co. This scenario will be difficult for Boats Co to argue against, as their £15000 renovation fee was not spent for the wellbeing of the contract, instead for their firm’s gain.

These possible outcomes, although explained thoroughly, lack complete confidence due to the Act’s subjectiveness. The Act states that ‘in the case of sums so payable, cease to be so payable’ which involves sums paid before the contract’s frustration will be paid back as possible, not exceeding the sum paid. Although seemingly foolproof, it remains vague. S1(1) LRA 1943 gives no guidance to current unpayable sums based upon guaranteed sums within the contract in the past. It offers no guidance when trying to determine whether or not payments/investments were made in order to carry out the contract or for personal benefit. The Act fails to dedicate the thought towards situations such as these, applying a huge proportion of doubt.

For instance, if Boats Co had a possible substitute boat, was the £15000 spent based off of the £25000 sum which they were yet to receive. Even more so, how easy is it to assess if Boats Co made any specific ‘benefits’ from these renovations. Yes, they now have a more equipped boat, but will this increase their running and maintenance costs? Furthermore, it fails to speak upon payables unpaid that influenced decisions made by either party within a case. It provides no insight as to whether Amber’s lateness make her missed payable excusable if it was not paid before the frustration. S1(1) LRA 1943 provides no insight towards subjective factors, such as: ‘is it possible for investments to be made off of a supposed sum which has not been paid yet?’. Which makes the previous decided outcomes for Amber v Boats Co even more subjective.

The Act focuses upon broad circumstances without applying a great deal of thought to any specifics, which makes you question how necessary it truly is. S1(1) LRA 1943 is a means to decide where specific funds get reallocated after the frustration of a contract; this acts as a way to avoid confusion. Of course, this is what the court intended, nevertheless, it is still striking as a disorderly Act which is negligent of a wide variety of case-deciding scenarios. S1(1) LRA 1943’s necessity therefore is challenged.

It is best to focus upon what the Act offers, compared to what it attempts to offer. The Act outlines the forefront of the matter at hand, providing an in-depth description of payables, and when they are supposed to be reallocated to the sender. Through this description, the Act allows the court to have a greater understanding on contract frustration, acting as a means of reference during the court room for the judges when using Obiter Dictum. Nevertheless, many scenarios and specifics are missed from S1(1) LRA 1943, as if the contract was merely frustrated ceteris paribus, providing a bare model of contract frustration. This factor acts as an incentive towards the Act not being necessary. However, it should be necessary regardless of its lack of specificity. This is most particularly due to the fact that it would be next to impossible to include each and every scenario of contract frustration, with the S1(1) LRA 1943 doing a suitable job by outlining the common factors within every type of case.

S1(1) LRA 1943 therefore provides not an effective solution to each case, but instead a suitable subjective outlook for judges for each case. It does not confine contract frustration into right/wrong or black/white; on the contrary it enforces decision-making, as well as evaluative thinking. Broken down into 3 sections: (1) Basis/Thesis; (2) Sums being paid/payable; (3) Benefits received as per these sums either payable or no-longer payable, S1(1) LRA 1943 provides a suitable range of information regarding adjustment of rights and liabilities of parties to frustrated contracts, making it nothing short of necessary in UK law.

I hope that you enjoyed my viewpoint on the situation. Please leave a comment and share your own opinions. Thank you very much for reading.