the government’s seizure of the defendant’s Saurer tanker did not frustrate his contract with the plaintiff because: (a) under the common law frustration occurred where an external event of some kind which was not the responsibility of either party (b) rendered further performance of a contract impossible or radically different from what had been contracted for. No valid finding of frustration could therefore be made without the court construing the contract to determine the nature of the obligation created on the parties-the obligation if unfulfilled buy a party would entitle the other to sue for a breach of it-because on the authorities the unexpected event should affect the subject matter of the contract or the fundamental obligation created by the contract and not just any term of the contract. On the evidence, the obligation of the plaintiff was to advance money to the defendant, which it did, and that of the defendant was to repay the loan with interest, if any. Accor­dingly, the performance of the purpose for which the loan was sought, though a term of the loan, was not the fundamental obligation owed by the defendant to the plaintiff. Since the seizure of the vehicle did not affect that fundamental obligation, both the trial judge and the majority of the Court of Appeal erred in holding that the loan contract had been frustrated. Taylor v Caldwell (1863) 122 ER 309; FA Tamplin SS Co Ltd v Anglo-Mexican Petroleum Products [1916] AC 397; Tatem Ltd v Gamboa [1939] 1 KB 132; Hangkam Kwinglong Woo v Liu Lan Fong [1951] 1 All ER 567, PC and Davis Contractors Ltd v Fare/lam UDC [1956] 2 All ER 145 cited. (c) Even if the operation of the vehicle was necessary for the defendant’s performance of his obligation to repay the loan, he was in breach of that obligation by buying a vehicle totally different from what was contracted for without the prior approval of the plaintiff. Since that election by the defendant led to the seizure of the tanker, it could not be concluded that the seizure had frustrated the loan contract for the purchase of the two Mercedes Benz trucks. Accordingly, the defendant could not claim the benefit of frustration. Dictum of Lord Denning in Ocean Tramp Tankers Corp v via Sorfracht (The El!genia) 1 All ER 161 at 165, CA applied. The Super Servant Two [1996] 1 Lloyd’s Rep 1 cited.