IMPOSSIBILITY OF PERFORMANCE
An agreement to do an act impossible in itself is void. A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful.
Law of Crimes – Culpable Homicide & Murder
1. Impossibility existing at the time of contract
If performance of an agreement is impossible at the inception itself, the agreement is void. It is immaterial that the parties had the knowledge of impossibility or not. But where the promisor knew the performance to be impossible or unlawful, or might have known with reasonable diligence, and promisee did not know to be impossible or unlawful, he must make compensation to the promisee for any loss sustained due to non-performance of the promise.
Law of Contract – Performance of Contract
2. Supervening impossibility
Supervening impossibility refers to the condition where the agreement is valid at the inception, but subsequent events or change in circumstances, beyond contemplation of the parties, has rendered its performance impossible or unlawful. In such cases, the contract is rendered void.
Some examples of Supervening impossibility are as follows –
Law of Contract: Multiple Choice Questions
(i) Accidental destruction of the subject matter of the contract
For example, A hires B’s wedding hall for A’s son’s wedding on a certain date. Before the said date, the hall is destroyed by earthquake. The contract is rendered void because of the destruction of the subject matter.
(ii) Non-occurrence of a contemplated event
For example, A hires B’s house on rent for specific time period to witness a religious procession. The purpose is disclosed to B. But the said procession is cancelled. A neither takes possession of the house nor pays the rent. Since the foundation of the contract has failed, A cannot be compelled to pay the rent.
(iii) Incapacity to perform a contract of personal services
Where the contract involves performance of the promise by the promisor using his own skill, promisor’s disability, incapacity or illness amounts to supervening impossibility.
(iv) Change in law
At times, change in law may render the performance of a contract impossible. For example, a subsequent law may altogether prohibit the act which forms the basis of contract.
For example, A and B enter into partnership business for sale of lottery. Lottery is subsequently banned by the State. The partnership agreement becomes void.
(v) Outbreak of war
Out break of war may also affect performance of the contract. For example, agreement between individuals of two nations for supply of goods for a price becomes void on the outbreak of war between the two nations.
What would not constitute ground of impossibility
Some examples of situations that may appear but are not covered under supervening impossibility are as follows –
(a) A promised to B that he would arrange for B’s marriage with his daughter. A could not persuade his daughter to marry B. B sued A. A pleaded impossibility. But it was held that there was no ground of impossibility. A should not have promised what he could not have accomplished. Further A had chosen to answer for voluntary act of his daughter and hence he was liable.
(b) The defendant agreed to supply specified quantity of ‘cotton’ manufactured by a mill with in a specified time to plaintiff. The defendant could not supply the material as the mill failed to make any production at that time. The defendant pleaded on the ground of impossibility. Held that contract was not performed by the defendant and he was responsible for the failure.
(c) A labour strike would not necessarily relieve a contractor from his obligation of unloading the ship within specified time.
To sum up, while judging the impossibility of performance issue, the Courts are very cautious since contracting parties often bind themselves to perform at any cost without proper regard to prevailing prices and market conditions. To uphold the defence of supervening impossibility, the event must be uncontemplated, compelling and beyond the control of parties.
