USA

226 How an Event May Be Made a Condition

An event may be made a condition either by the agreement of the parties or by a term supplied by the court.

CHAPTER 11 - IMPRACTICABILITY OF PERFORMANCE AND FRUSTRATION OF PURPOSE

254 Effect of Subsequent Events on Duty to Pay Damages see also Remedies

1. A party's duty to pay damages for total breach by repudiation is discharged if it appears after the breach that there would have been a total failure by the injured party to perform his return promise.

2. A party's duty to pay damages for total breach by repudiation is discharged if it appears after the breach that the duty that he repudiated would have been discharged by impracticability or frustration before any breach by non-performance.

261 Discharge by Supervening Impracticability

Where, after a contract is made, a party's performance is made impracticable without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, his duty to render that performance is discharged, unless the language or the circumstances indicate the contrary.

262 Death or Incapacity of Person Necessary for Performance

If the existence of a particular person is necessary for the performance of a duty, his death or such incapacity as makes performance impracticable is an event the non- occurrence of which was a basic assumption on which the contract was made.

263 Destruction, Deterioration or Failure to Come Into Existence of Thing Necessary for Performance

If the existence of a specific thing is necessary for the performance of a duty, its failure to come into existence, destruction, or such deterioration as makes performance impracticable is an event the non-occurrence of which was a basic assumption on which the contract was made.

264 Prevention by Governmental Regulation or Order

If the performance of a duty is made impracticable by having to comply with a domestic or foreign governmental regulation or order, that regulation or order is an event the non- occurrence of which was a basic assumption on which the contract was made.

265 Discharge by Supervening Frustration

Where, after a contract is made, a party's principal purpose is substantially frustrated without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, his remaining duties to render performance are discharged, unless the language or the circumstances indicate the contrary.

266 Existing Impracticability or Frustration

1. Where, at the time a contract is made, a party's performance under it is impracticable without his fault because of a fact of which he has no reason to know and the non- existence of which is a basic assumption on which the contract is made, no duty to render that performance arises, unless the language or circumstances indicate the contrary.

2. Where, at the time a contract is made, a party's principal purpose is substantially frustrated without his fault by a fact of which he has no reason to know and the non- existence of which is a basic assumption on which the contract is made, no duty of that party to render performance arises, unless the language or circumstances indicate the contrary.

267 Effect on Other Party's Duties of a Failure Justified by Impracticability or Frustration

1. A party's failure to render or to offer performance may, except as stated in Subsection (2), affect the other party's duties under the rules stated in §§ 237 and 238 even though the failure is justified under the rules stated in this Chapter.

2. The rule stated in Subsection (1) does not apply if the other party assumed the risk that he would have to perform despite such a failure.

268 Effect on Other Party's Duties of a Prospective Failure Justified by Impracticability or Frustration

1. A party's prospective failure of performance may, except as stated in Subsection (2), discharge the other party's duties or allow him to suspend performance under the rules stated in §§ 251(1) and 253(2) even though the failure would be justified under the rules stated in this Chapter.

2. The rule stated in Subsection (1) does not apply if the other party assumed the risk that he would have to perform in spite of such a failure.

269 Temporary Impracticability or Frustration

Impracticability of performance or frustration of purpose that is only temporary suspends the obligor's duty to perform while the impracticability or frustration exists but does not discharge his duty or prevent it from arising unless his performance after the cessation of the impracticability or frustration would be materially more burdensome than had there been no impracticability or frustration.

270 Partial Impracticability

Where only part of an obligor's performance is impracticable, his duty to render the remaining part is unaffected if

• it is still practicable for him to render performance that is substantial, taking account of any reasonable substitute performance that he is under a duty to render; or
• the obligee, within a reasonable time, agrees to render any remaining performance in full and to allow the obligor to retain any performance that has already been rendered.

271 Impracticability as Excuse for Non-Occurrence Of a Condition

Impracticability excuses the non-occurrence of a condition if the occurrence of the condition is not a material part of the agreed exchange and forfeiture would otherwise result.

272 Relief Including Restitution see also Remedies Mandatory Obligations

1. In any case governed by the rules stated in this Chapter, either party may have a claim for relief including restitution under the rules stated In §§ 240 and 377.

2. In any case governed by the rules stated in this Chapter, if those rules together with the rules stated in Chapter 16 will not avoid injustice, the court may grant relief on such terms as justice requires including protection of the parties' reliance interests.

[Chapter 11 - Impracticability of Performance and Frustration of Purpose]