Mineral Park Land Co. v. Howard
172 Cal. 289, 156 P. 458 (1916)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A party's contractual performance is excused under the doctrine of impracticability when an unforeseen contingency makes performance so excessively and unreasonably difficult or expensive that it is functionally impossible.
Facts:
- Mineral Park Land Co. owned land containing gravel and earth in the Arroyo Seco.
- Howard and his partners contracted with public authorities to construct a concrete bridge across the Arroyo Seco.
- Mineral Park and Howard entered into a written agreement for Howard to take all necessary gravel and earth for the bridge construction exclusively from Mineral Park's land.
- The contract specified a price per cubic yard, with an estimated requirement of 114,000 cubic yards.
- Howard took 50,131 cubic yards of gravel and earth from Mineral Park's land.
- All of the remaining gravel and earth on the property needed for the project was located below the water level.
- Extracting the underwater material would require a steam-dredger and drying process, increasing the cost to ten or twelve times the usual expense.
- Howard sourced the remaining 50,869 cubic yards of material from a different location.
Procedural Posture:
- Mineral Park Land Co. sued Howard and others in a state trial court.
- The complaint included a count for payment for gravel taken and a second count for damages from Howard's failure to take the remaining required gravel.
- The trial court entered a judgment for Mineral Park Land Co. on both counts, awarding $3,650.
- Howard (the defendants) appealed the trial court's judgment to the Supreme Court of California.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a party's obligation to perform under a contract become excused when the subject matter exists, but obtaining it can only be done at an excessive and unreasonable cost that was not contemplated by the parties?
Opinions:
Majority - Sloss, J.
Yes, a party's obligation is excused. Where performance depends upon the existence of a given thing, and that thing's existence was a basic assumption of the contract, performance is excused if the thing turns out to be non-existent in a practical sense. Here, the parties contracted for 'available' gravel. Although gravel technically existed on the land, the portion below the water level was not practically available because extracting it would have been at a prohibitive cost. The court found that a thing is 'impossible' in legal contemplation when it is not practicable, and it is impracticable when it can only be done at an excessive and unreasonable cost. While mere difficulty or increased expense is not an excuse, a cost increase of 10 to 12 times the anticipated amount makes performance impracticable, which is equivalent to the total absence of the subject matter.
Analysis:
This case is significant for expanding the contract defense of impossibility into the modern doctrine of commercial impracticability. It moves beyond a strict requirement of literal or physical impossibility, establishing that extreme and unreasonable difficulty or expense can also excuse performance. This decision provides a more flexible standard for courts when an unforeseen event fundamentally alters the nature of a party's contractual obligation. The principle laid out here was influential in the development of both the Uniform Commercial Code (UCC § 2-615) and the Restatement (Second) of Contracts § 261.
Unlock the full brief for Mineral Park Land Co. v. Howard