What constitutes impracticability in a contract?

Impracticability in the context of contract law refers to a situation where performance of the contract becomes excessively burdensome or difficult due to unforeseen circumstances that were not anticipated at the time the contract was entered into. This aligns with the concept of impracticability as established in the Restatement (Second) of Contracts and case law, which highlights that impracticability arises when a party faces extreme difficulty or the complete inability to fulfill their contractual obligations due to unforeseen events.

The correct answer highlights that the difficulty must be "extreme" and "not anticipated." For instance, if a natural disaster occurs or a sudden change in law impacts a key aspect of performance, this can render the contract impractical without the fault or foresight of the parties involved. Performance becomes more than just difficult; it entails an unreasonable burden that significantly alters the contractual relationship.

In contrast, options that suggest anticipated difficulties, mere unprofitability, or negligence do not satisfy the definition of impracticability. If the difficulty was anticipated, it does not meet the criteria for claiming impracticability since the parties should have accounted for it in their contractual agreement. Unprofitability alone does not establish impracticability since contracts may be unprofitable for various market reasons, which do not