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Tsakiroglou & Co. Limited v. Noblee Thorl Gesellschaft mit beschrankter Haftung

House of Lords
AC 93 (1962)


Facts

Noblee Thorl G.m.b.H (Noblee) (plaintiff) entered a cost, insurance, and freight (c.i.f.) contract to purchase Sudanese groundnuts from Tsakiroglou & Co. Ltd. (Tsakiroglou) (defendant) to be delivered in Hamburg. When the contract was entered, almost all shipments of nuts from Sudan traveled through the Suez Canal. However, it was possible, though rare, to ship the nuts by way of the Cape of Good Hope, but it was a significantly longer route. Before the nuts were shipped, a military conflict blocked the use of the Suez Canal. Tsakiroglou never shipped the nuts, and Noblee demanded arbitration for breach of contract. An arbitration panel awarded Noblee, the buyer, damages. Tsakiroglou challenged the arbitration award in court. The trial court upheld the arbitration award, and the court of appeals affirmed the judgment. Tsakiroglou appealed to the House of Lords, arguing that it was not liable for delivery of the nuts, because the contract was frustrated by the closing of the Suez Canal.

Rule of Law

Issue

Holding and Reasoning (Viscount, J.)

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