Frustration and the Chattel Interest
| Date | 01 November 1958 |
| DOI | http://doi.org/10.1111/j.1468-2230.1958.tb00500.x |
| Author | S. Yahuda |
| Published date | 01 November 1958 |
FRUSTRATION AND THE CHATTEL
INTEREST
THERE is
no
consensus of opinion among the heads of the law in
England
on
the rule that frustration applies to leases. In the Court
of Appeal it was fist questioned by Atkin
L.J.
(as he then was)
in his minority judgment in
Matthey
v.
Curling.’
In the House of
Lords, however, Lord Simon and Lord Wright held
obiter
in the
Cricklewood
case
a
that there was
no
reason why frustration should
not apply to leaseholds.
But in the Court of Appeal the rule that frustration does
not
apply to leases is still law and its
raison
d’&tre
is
the subsistence
of the so-called chattel interest, also
known
as
“term of years,”
created by the lease.
In
London
4
Northern Estates, Ltd.
v.
SchlesingerS
Lush
J.
said
:
It
is not correct to speak of this tenancy agreement as
a
con-
tract and nothing more. A term of years was created by
it
and vested in the appellant, and
I
can see
no
reason
for
saying
that because this order disqualifies
him
from personally residing
in the flat,
it
affected the chattel interest which
was
vested
in
him by virtue of the agreement.
In
my opinion it continues
vested in
him
still.
There is
no
question that Lush
J.
uses the phrases
“
term of years
”
and
“
chattel interest
’)
to convey an estate in the land incidental
to the lease-an interest of
a
secondary character subject
to
the
lease and following its-the lense’destiny: it is a creature of
the lease.
In
his speech in the
Cricklewovd
case, Lord‘Wright treats
it as such.‘
In
the same case Lord Russell says
:
A lease may come
to
an end, and with
it
the estate
in
the
land and all contractual liability, by virtue of some provision
in the lease, or by reason of some defect in the title of
the
person who purported
to
grant
it.
It
follows that the chattel interest is not indefeasible: the lessee
may contract out of it by express stipulation. One is reminded
of
the words in
Paradine
v.
Jane,6
that the lessee “could provide
against it by his contract,”
i.e.,
against his obligation to pay rent
or repair.
1
2
[lo221
2
A.C.
180.
Cricklewood Property
&
Investment Trust, Ltd.
v.
Leighton’s Znoestmcnt
Trust,
Ltd.
[1945]
A.C.
221.
[1916]
1
K.B.
20,
at
24.
4
[1945]
A.C.,
at
240.
6
Ibid.,
at
231.
8
(1647)
Aleyn.
26.
637
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