If, after a contract is formed, something happens which was not either party’s fault but which means the contract can no longer be performed or its performance (including the number of guests who can safely/lawfully attend) would be radically different to what was agreed, then the contract may be legally ‘frustrated’.

The CMA’s starting point is that a full refund will be due to the consumer/customer where:

- the business cancels the contract without providing any of the promised services, e.g. a DJ cancels playing an event

- no service is provided, for example because it is prevented by the government’s public health measures, e.g. the event can go ahead, but with restrictions, meaning the DJ cannot provide their services

- the consumer cancels, or is prevented from receiving any services, because public health measures mean they are not allowed to use the services, e.g. there is a local lockdown meaning the event cannot proceed.

It says a full refund is due even where a pre-payment is labelled a ‘non-refundable deposit’ or ‘advance payment.’ In limited circumstances, deductions can be made as a contribution to costs incurred in relation to a contract, but only when the business cannot recover those costs from elsewhere. This might include committed expenditure in relation to the customer’s contract which cannot be cancelled or refunded and for which it cannot make a claim under an insurance policy.


Other key points to note from the CMA’s guidance are: