Also known as: section 2-615 · UCC 2-615 · § 2-615 · UCC § 2-615 · 2-615 · UCC impracticability · commercial impracticability
Written by attorneys · grounded in primary & secondary sources — see below
A statutory rule excusing a seller from delay or non-delivery under a contract for the sale of goods when performance has become impracticable due to a contingency the non-occurrence of which was a basic assumption on which the contract was made. The seller must allocate any reduced capacity fairly among customers and give seasonable notice of the shortfall. The rule applies only to sellers and does not excuse buyers.
Sapphire Holdings contracted to sell corn to Southland Foods at a fixed price. A severe unexpected drought cut regional yields by seventy percent. Sapphire Holdings allocated its remaining supply fairly and notified Southland Foods of the shortfall. The contingency satisfies the basic-assumption requirement and excuses the reduced deliveries.
Sapphire Technologies agreed to supply steel beams to Skyline Construction at a fixed price. Steel prices rose sharply after formation. Sapphire Technologies refused to deliver claiming the increase made performance impracticable. Ordinary market fluctuations do not satisfy the basic-assumption test and the duty continues.
Select any source to read its text and confirm it supports the definition.
Alcoa contracted to supply aluminum to Essex at a fixed price subject to an escalation clause. Inflation drove production costs far higher than the clause covered. Alcoa claimed the increase made performance impracticable and sought excuse or price adjustment. A substantial cost increase alone does not satisfy the basic-assumption test and the duty to perform at the adjusted contract price continues.
Scott Summers agreed to carry cargo from Texas to Iran via the Suez Canal. The canal closed after formation. Scott Summers delivered by the longer Cape route at substantially higher cost. The closure satisfies the basic-assumption requirement and excuses performance by the original route.
Sasha Stone's airline contracted to buy jet fuel at a fixed price. World events caused fuel prices to triple. Sasha Stone demanded a price increase or threatened to stop deliveries. The price increase alone does not satisfy the basic-assumption requirement and the duty to deliver at the contract price continues.
No. The statute applies only to sellers. A buyer remains obligated to pay even when market conditions change after formation.
Yes. The seller must seasonably notify the buyer of any delay or shortfall caused by the contingency.
No. Substantial cost increases alone are ordinarily insufficient unless they transform the nature of performance rather than merely make it more expensive.
The seller must allocate the reduced supply fairly among customers and give seasonable notice of the shortfall.
…method of performance, compare Annot., 84 A.L.R.2d 12, 19 (1962), there is nothing necessarily inconsistent in claiming commercial impracticability for the method of performance actually adopted; the concept of impracticability assumes performance was physically possible. Moreover, a rule making nonperformance a condition precedent to…