ch.20 - changed circumstances

Question 1

changed circumstances general rule

Answer 1

If the change was smth that the parties did not contemplate at contract formation, then there may be relief through the doctrine of changed circumstances.

Question 2

when will the courts relieve a party of its duty for changed circumstances

Answer 2

only when it is in the interest of equity and justice

Question 3

what are the three theories in the doctrine of changed circumstances

Answer 3

• impossibility
• impracticability
• frustration of purpose

Question 4

impossibility

Answer 4

performance must be literally impossible by anyone

Question 5

impracticability

Answer 5

performance must result in an extreme and unreasonable difficulty, expense, injury, or loss

Question 6

frustration of purpose

Answer 6

performance would be meaningless

Question 7

elements for changed circumstances

Answer 7

1. After contract formation
2. A supervening event occurs w/o fault of the party seeking relief
3. The event causes a parties performance to become impossible/impracticable/substantially frustrated
4. The nonoccurrence of the event was a basic assumption on which the contract was made
5. The parties duties are discharged unless the contract language or circumstances indicate risk should be allocated to one party.

Question 8

what occurs if if the contract is made only partially impossible?

Answer 8

the court might partially enforce the agreement by making void the impossible obligations but still enforce the rest of the agreement

Question 9

what occurs if performance is only rendered impossible temporarily?

Answer 9

the duties under the agreement are only suspended until performance is no longer impossible

Question 10

UCC impracticability

Answer 10

excuses a seller from timely delivery of goods, where his performance has become commercially impracticable bc of unforeseen supervening circumstances not within the contemplation of the parties at the time of contracting

Question 11

substantially frustrated test

Answer 11

whether the “principal purpose” of the contract is “substantially frustrated” so as to make performance of one party worthless to the other party

Question 12

typical scenarios where changed circumstances may apply

Answer 12

• destruction of a thing that was essential to the performance
• death/incapacity of a person when the duty may not be delegated to another
• government action makes the performance illegal