If a law is passed after the parties enter into a contract that makes performance illegal,the contract is:
A) terminated by operation of law.
B) void from the beginning.
C) terminated by alteration.
D) unenforceable.

Question

Quizplus · Accepted Answer

If a law is passed after parties enter into a contract that makes performance illegal, the contract is terminated by operation of law because it becomes impossible for the parties to fulfill their obligations under the agreement. This is known as frustration of purpose, and it automatically terminates the contract. The parties may not be held liable for breach of contract because the law has made it impossible for them to perform.

If a Law Is Passed After the Parties Enter into a Contract