If the specific purpose for a contract no longer exists, which doctrine discharges the obligor from performance?

The doctrine that discharges the obligor from performance when the specific purpose for a contract no longer exists is known as frustration of purpose. This legal concept applies when an unforeseen event occurs that undermines the foundational reason for entering into the contract, thereby making performance pointless.

In essence, if the primary reason both parties had for entering the contract is no longer achievable, the contract may be discharged. For example, if a person rents a venue for a specific event that then gets canceled due to circumstances out of both parties' control, the purpose of the contract is frustrated. The crucial aspect here is that the parties had a mutual understanding of the significance of the contract's purpose, and the disruption must be substantial enough to warrant discharge.

Other doctrines, while relevant in certain contexts, do not specifically apply in the same way. Impossibility of performance pertains to situations where fulfilling the contract has become objectively impossible. Commercial impracticability relates to scenarios where performance can still occur but would be excessively burdensome or costly. Force majeure refers to extraordinary events that prevent contract performance but typically requires the event to be defined within the contract itself. Each of these doctrines has its specific application and requirements, which differ from the principle underlying frustration of purpose.