Question $1(25$ marks$)$

Bob planned to spend a ten$-$day holiday in Peru with his brother, Dennis $.$ Bob paid Surprise Travel Limited a deposit of $$80,000$ for the air fares from Hong Kong to Peru and the hotel accommodation charges for ten days, with an outstanding amount of $$120,000$ to be paid upon commencement of the planned trip.

Immediately before Bob and Dennis left Hong Kong for the purchased trip and hotel accommodation, the following events happened:

Event $1$ Series of avalanches slid down Andes Mountains in Peru, resulting in cancellation of all flights to and from Peru for one month.

$($Instead of the avalanches occurring$)$:

Event $2$ A riot broke out in Peru. In response, the government declared a state of emergency, under which travels to and from Peru were banned for one month.

Therefore, Bob and Dennis were not able to travel to Peru for their planned holiday. Bob wanted to have a refund of the $$80,000$ deposit from Surprise Travel Limited. While there was a provision in the contract signed with Surprise Travel Limited that all purchased trips and hotel accommodation could not be postponed, there was no provision regarding refund of deposit under the contract, nor any reference made to the consequence of an avalanche occurring or a state of emergency being declared.

Please discuss:

Part A Whether the contract was frustrated under the facts of Event $1(12$ marks$)$ and Event $2(8$ marks$)$ respectively. $($Total: $20$ marks$)$

Part B Assuming that the contract was frustrated under both Event $1$ and Event $2,$ whether Bob can claim a refund of the $$80,000$ deposit from Surprise Travel Limited $(5$ marks$)$

The case must not be merely a repeat of an existing case; it must be combining several cases$/$legal principles.

Formation of Contract$-$Invitation to Treat, Offer and Acceptance

Formation of Contract$-$Consideration

Formation of Contract$-$Intention to Create a Legally Binding Relationship Contracting Capacity

Representations, Terms and Conditions

Exemption Clauses;

Vitiating Factors$-$Misrepresentations

Vitiating Factors$-$Mistakes

Vitiating Factors$-$Duress and Undue Influence

Discharge and Remedies by Frustration

Discharge and Remedies $($other than by Frustration$)$