Question

Which of the following is used as a basis for discharge by operation of law when performance is still objectively possible but would be extraordinarily injurious or expensive to one party?

A. Frustration of purpose
B. Commercial impracticability
C. Alteration of the contract
D. Anticipatory repudiation
E. Anticipatory renunciation

Answer 1

The correct answer is letter B.

Explanation: Impossibility is an excuse for not fulfilling obligations under a contract, based on a change of circumstances (or a discovery of pre-existing circumstances), an occurrence that was an underlying assumption of the contract, which causes execution of the contract literally impossible.