IV.   Consensus

Frustration, also known as Frustration of Purpose, is a fictional concept whereby an unforeseen event delays, impedes or prevents the performance of a primary element of a Consensus Instrument which both parties agreed represented a principle purpose of the Consensus.

“Principle purpose” of a Consensus in relation to Frustration (of Purpose) is any intrinsic element of the Consensus of such importance that neither party would have entered the Consensus in the first place in its absence.

Frustration is not equivalent to Impossibility even though both concepts relate to unforeseen events. Impossibility concerns unforeseen events and the duties specified to be performed in an Consensus, whereas Frustration concerns any unforeseen events and the reason a party entered into the Consensus.

Where Consensus has not made provision to exclude certain unforeseen events, the defense of Frustration may be argued as a lawful defense for non performance of duties under a Consensus for those events not otherwise excluded.

No mercantile Consensus may seek to exclude Force majeure as a defense for Frustration and as a lawful excuse for non-performance.