Frustration, not Fortitude: the Case for Applying the Doctrine of Frustration to Leases Affected by COVID-19

Abstract

The impact of the COVID-19 pandemic on retail businesses raises the pertinent question of whether commercial leases can be deemed to be frustrated, so that tenants may be released from their rental obligations. Focusing on the plight of restauranteurs, but relevant to the retail sector in general, this paper discusses the doctrine of frustration with respect to restaurant leases affected by the COVID-19 crisis. It puts forward the view that the doctrine does, and should, apply to these leases in these COVID-19 circumstances, not least because in spite of Government relief measures, frustration may be the only way out for restauranteurs.

Keywords: COVID-19, Contract, Leases, Frustration, Restaurants, F&B, Law

JEL Classification: K00, K10, K11, K12, K20, K29, K30, K39