Facts
Fibrosa, a Polish company, agreed to buy some machinery for £4,800 from Fairbairn, an English-based company. In July 1939, Fibrosa made a payment of £1,000 as part of the agreement. By September Germany had invaded Poland and Britain had declared war. Fibrosa attempted to get the payment back but Fairbairn refused arguing that the invasion frustrated the contract. Fibrosa brought an action against Fairbairn.
The lower courts held, taking as their authority Chandler v Webster 1 KB 493, that where a contract has been frustrated by a supervening event, "the loss lies where it falls", with the result that sums paid or rights accrued before that event are not to be surrendered, but that all obligations falling due for performance after that event are discharged. Consequently, the lower courts rejected Fibrosa's claim to recover the £1,000.
Read more about this topic: Fibrosa Spolka Akcyjna V Fairbairn Lawson Combe Barbour Ltd
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