A contract between a buyer and seller would be discharged if the subject matter is destroyed before performance. Which event discharges the contract?

• A. House burns down
• B. Buyer changes mind
• C. Seller accepts performance
• D. The contract expires

Answer: (A)

When the thing the contract is about is destroyed before performance, the obligation becomes impossible to fulfill, so the contract is discharged. For example, if there’s a contract to sell a house and the house burns down before delivery, neither side can complete the deal, so the contract ends automatically.

That’s why the destruction of the subject matter is the situation that discharges the contract. If the buyer merely changes their mind, that’s a breach, not a discharge. If the seller has already accepted performance, the contract is no longer open to discharge by destruction because performance has occurred. Expiration of the contract is a separate termination event and not the same as destruction of the subject matter.