Herne Bay Steam Boat Co v Hutton [1903]

Herne Bay Steam Boat Co v Hutton [1903] 2 KB 633 is a case in English contract law that addresses the issue of frustration of contract when the cancellation of an event occurs. The key principle established in this case is that the cancellation of an event, for which the contract was made, does not frustrate the contract if the contract is not unique to that specific event.

The defendant had hired a vessel from the claimant for the purpose of viewing a naval review. However, when the naval review was canceled, the defendant refused to pay the balance for the vessel's hire. The claimant then sued the defendant for the payment of the balance, and the defendant argued that the contract had been frustrated due to the cancellation of the naval review.

The Court of Appeal held that the defendant was in breach of the contract, and therefore, the claimant was entitled to damages. The contract was not terminated by frustration. Romer LJ emphasised that the ship hired had no particular connection or uniqueness tied to the naval review. Any other ship could have served the same purpose. The purpose of hiring the ship did not form the subject matter or essence of the contract. Additionally, the defendant noted that the purpose of the hiring was a concern only for the hirers, not the owners of the ship.

This case is distinguished from Krell v Henry [1903] on the basis that, in Herne Bay Steam Boat Co v Hutton, any ship could be hired to view the naval review. In Krell v Henry, the rented room was unique and chosen specifically for its special view.

It is important to take note of a parallel analogy drawn from Krell v Henry, where Vaughan Williams LJ used the example of hiring a cab for the purpose of going to the Epsom Derby, and if the derby was canceled, the contract would be frustrated. Similarly, in Herne Bay Steam Boat Co v Hutton, it is highlighted that the ship's purpose was not integral to the essence of the contract, making it distinguishable from situations where the uniqueness of the subject matter is crucial to the contract's fulfilment.
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