What form of discharge occurs when the subject matter of a contract is destroyed?

The form of discharge that occurs when the subject matter of a contract is destroyed is called impossibility. This legal concept applies when an unforeseen event makes it impossible for one or both parties to fulfill their contractual obligations.

For instance, if a contract is based on a specific item that is destroyed—such as a car in a sale agreement or a piece of artwork being commissioned—then the obligation becomes impossible to perform since the subject matter no longer exists. In such cases, the law recognizes that the parties should not be held to the contract because performance is no longer feasible.

Impossibility typically requires that the event was not caused by the parties involved and was not foreseeable at the time the contract was made. This ensures that neither party is unfairly penalized for circumstances beyond their control.

The other options represent different legal concepts that do not specifically relate to the destruction of contract subject matter. Novation involves replacing an old contract with a new one, accord and satisfaction refers to settling a disputed obligation, and rescission is the cancellation of a contract, typically by mutual agreement. None of these apply directly to the situation of contract subject matter destruction in the same manner that impossibility does.