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Salman signs a contract to build a warehouse in Sydney for his client. They agree...

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Accounting

Salman signs a contract to build a warehouse in Sydney for his client. They agree on the price and time frame for the completion of the project. Salman hires two apprentices on lower wages than qualified tradespeople; he also hires another two labourers on a daily basis. Work is about to commence. But digging the foundation takes much longer than expected because Salman and his crew had to extract some large rocks embedded within the soil. The labourers he hired leave him and there are no other labourers he can hire on such short notice to replace them. One of the apprentices completes his apprenticeship and will not have to be paid full trade wages. The other apprentice leaves for Adelaide. Salman now has no labourers to finish building the warehouse. The cost of employing new tradespeople will mean that he will lose money in building the warehouse. He wants to terminate the contact and believes that he has grounds to do so due to frustration of contract. He then tells the client that he cannot proceed with building the warehouse but would like to be paid for the foundation work. (a) Can Salman correctly argue that the contract is frustrated? (b) Can he ask for payment for the foundation work done on the building?

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