Put another way, the doctrine of commercial frustration excuses performance only when the parties’ overall contractual intent and objectives have been completely thwarted by an unforeseen event. The doctrine of commercial frustration will render a contract unenforceable if a party’s performance under the contract is rendered meaningless due to an unforeseen change in circumstances.
In Illinois, the doctrine of commercial frustration is alive and well. However, one legal theory that may be available to contracting parties without reference to force majeure is that of “commercial frustration.” Nuances of the Doctrine of “Commercial Frustration”Ĭourts in Illinois strictly interpret contracts, and in the absence of a clear intention to excuse or delay performance, for example as expressed in an unambiguous force majeure clause, Courts will be reluctant to excuse or delay performance due to COVID 19. For example, following the 1918 Spanish Flu Epidemic, a Court in California excused prompt performance, but not complete performance, after carefully analyzing the contract and the facts incident to delayed performance. Whether or not the COVID-19 pandemic excuses contract performance largely depends on the language of the contract and the facts that either support excusing performance or not. COVID-19 is impacting businesses and their operations, and parties are looking for guidance in the event that one or the other party to a contract is, or claims to be, unable to fulfill its contractual obligations.
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