Frustrated Contracts Act 1978 (NSW)

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An Act to amend the law relating to frustrated contracts.

Part 1Preliminary1Name of Act

This Act may be cited as the Frustrated Contracts Act 1978.

2Commencement(1)

This section and section 1 shall commence on the date of assent to this Act.

(2)

Except as provided in subsection (1), this Act shall commence on such day as may be appointed by the Governor in respect thereof and as may be notified by proclamation published in the Gazette.

3

(Repealed)

4Act binds the Crown

This Act binds the Crown, not only in right of New South Wales but also, so far as the legislative power of Parliament permits, the Crown in all its other capacities.

5Interpretation(1)

In this Act, except to the extent that the context or subject-matter otherwise indicates or requires:

agreed return, in relation to performance of a contract by a party, means such performance of the contract by another party as is contemplated by the contract as consideration for the first-mentioned performance.

court, in relation to any matter, means the court or arbitrator before whom the matter falls to be determined.

frustration includes avoidance of an agreement under section 12 of the Sale of Goods Act 1923.

party includes the assigns of a party.

performance, in relation to a contract, means:

  • (a)

    performance, wholly or in part, of a promise in the contract, or

  • (b)

    fulfilment, wholly or in part, of a condition of or in the contract.

(2)

Where performance of a contract is referred to in a provision of this Act:

  • (a)

    a reference in the provision to the performing party is a reference to the party to the contract by whom the performance was, or was intended to be, given, and

  • (b)

    a reference in the provision to the other party to the contract is a reference to the party by whom performance of the contract is contemplated by the contract as consideration for the performance referred to in the provision.

(3)

For the purposes of this Act, performance of a contract is given and received if received as contemplated by the contract, whether received by a party to the contract or not.

(4)

For the purposes of this Act, where a contract has been frustrated and a thing is done or suffered under the contract after the time of frustration but before the party who does or suffers that thing knows or ought to know of the circumstances (whether matters of fact or law) giving rise to the frustration, that thing has effect as if done or suffered before the time of frustration.

(5)

It is the intention of Parliament that, except to the extent that the parties to a contract otherwise agree, a court other than a court of New South Wales may exercise the powers given to a court by Part 3 in relation to the contract.

6Act does not apply to certain contracts(1)

This Act:

  • (a)

    does…

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.