This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Original impossibility of fact may exist where the contract is not impossible of performance on its face, since the subject-matter of the contract is one the existence of which is possible; but where the contract is, nevertheless, impossible of performance in fact, because the subject-matter with which the parties believe that they are dealing, does not exist in fact.1 One of the most common illustrations of impossibility of this sort is found in contracts by which the owner of mineral land grants to another the privilege of removing mineral therefrom, and the latter agrees to remove a certain minimum quantity of mineral and to pay a specified royalty therefor. If the specified amount of mineral does not exist under such land, this fact operates as a discharge of the contract unless the party who agreed to remove such minimum amount also agreed to take the risk of a deficiency in quantity.2 A sale of an interest in realty which does not exist, is inoperative unless the parties thereto intended that such risk should be assumed by one or the other.3
1 Hall v. Cazenove, 4 East. 477; The Harrimnn, 76 U. S. (9 Wall.) 161, 19 L. ed. 629; Cooper v. Livingston, 19 Fla. 684; LeRoy v. Jacoboaky, 136 N. Car. 443. 67 L. R. A. 977, 48 S. E. 796.
2 Rolle's Abridgment. Conditions 420.
3 Hall v. Cazenove, 4 East. 477; Le roy v. Jacobosky, 136 N. Car. 443, 67 L. R. A. 977, 48 S. E. 796.
4 Cooper v. Livingston, 19 Fla. 684. (The covenant in this case was illegal by statute as well as impossible.)
1 England. Couturier v. Hastie, 5 H. L. 673; Smidt v. Tiden, L. R.. Q. B. 446.
United States. Allen v. Hammond, 36 U. S. (11 Pet.) 63, 9 L. ed. 633; Great Northern Ry. Co. v. Reid, 245 Fed. 86.
Alabama. Brooks- v. Cook, 135 Ala. 219, 34 So. 960.
Illinois. Koenig v. Haddix, 21 Ill. App. 53.
Kansas. Smith v. Kansas City, 102 Kan. 518, 171 Pac. 9.
Kentucky. Blakemore v. Blakemore, (Ky.), 44 S. W. 96.
Maine. Neal v. Coburn, 92 Me. 139, 69 Am. St. Rep. 495, 42 Atl. 348.
Massachusetts. Gould v. Emerson, 160 Mass. 438, 39 Am. St. Rep. 501, 35 N. E. 1065.
Michigan. Gibson v. Pelkie, 37 Mich. 379; Gribben v. Atkinson, 64 Mich. 631, 31 N. W. 570; Blake v. Lobb, 110 Mich. 608, 68 N. W. 427; Gauntlett v. Sea Ins. Co., 127 Mich. 504, 86 N. W. 1047; Hewitt Iron Min. Co. v. Dessau Co., 129 Mich. 590, 89 X. W. 365.
Minnesota. Diamond Iron Min. Co. v. Buckeye Iron Min. Co., 70 Minn. 500, 73 N. W. 507; Althoff v. Torrison, 140 Minn. 8, 167 N. W. 119.
Missouri. Fisher v. During, 53 Mo. App. 548.
New York. Duncan v. New York Mutual Ins. Co., 138 N. Y. 88, 20 L. R. A. 386, 33 N. E. 730.
Ohio. Cook v. Andrews, 36 O. S. 174; Brick Co. v. Pond, 38 O. S. 65.
Pennsylvania, Muhlenberg v. Hen-ning, 116 Pa. St. 138, 9 Atl. 144; McCahan v. Wharton, 121 Pa. St.
424, 15 Atl. 615; Riegel v. American Life Ins. Co., 140 Pa. St. :193, 23 Am. St. Rep. 225, 11 L. R. A. 857, 21 Atl. 392; Riegel v. American Life Ins. Co., 153 Pa. St. 134, 19 L. R. A. 166, 25 Atl. 1070; Fink v. Smith, 170 Pa. St. 124, 50 Am. St. Rep. 750, 32 Atl. 566; Boyer v. Fulmer, 176 Pa. St. 282, 35 Atl. 235; Bannan v. Graeff, 186 Pa. St. 648, 40 Atl. 805.
Virginia. Burton v. Haden, 108 Va. 51, 15 L. R. A. (N.S.) 1038, 60 S. E. 736; Virginia Iron, Coal & Coke Co. v. Graham, - Va. -, 98 S. E. 659.
Vermont. Bedell v. Wilder, 65 Vt. 406, 36 Am. St. Rep. 871, 26 Atl. 589.
2 Alabama. Brooks v. Cook, 135 Ala. 219, 34 So. 960.
California. Williams v. Miller, 68 Cal. 291, 9 Pac. 166; Mineral Park Land Co. v. Howard, 172 Cal 289, L. R. A. 1916F, 1, 156 Pac. 458.
Florida. Hiller v. Ray, 59 Fla. 285, 20 Am. & Eng. Ann. Cas. 1162, 52 So. 623.
Iowa. Fritzler v. Robinson, 70 Ia. 500, 31 X. W. 61; Carr v. Whitebreast Fuel Co., 88 Ia. 136, 55 N. W. 205; Bloomfield Coal & Mining Co. v. Tid-rick, 99 Ia. 83, 68 N. W. 570.
Michigan. Gribben v. Atkinson, 64 Mich. 651 [sub nomine, Gibben v. Atkinson, 31 N. W. 570]; Blake v. Lobb's Estate, 110 Mich. 608, 68 N. W. 427; Hewitt Iron Mining Co. v. Dessau Co., 129 Mich. 690, 89 N. W. 365.
Minnesota. Diamond Iron Mining Co. v. Buckeye Iron Mining Co., 70 Minn. 500, 73 N. W. 507.
Cases of this sort are frequently explained on the theory of original impossibility; and they are frequently explained on the theory that a contract must have a subject-matter, and that unless a subject-matter exists, the contract lacks one of its essential elements.4
These cases can be better explained, however, on the theory of mistake. If the parties assume or believe that the subject-matter exists when in fact it does not exist, they enter into the contract through mistake as to the existence as to one of the essential elements of the contract, and for this reason no valid contract exists.5 That it is mistake rather than the non-existence of the subject-matter that renders contracts of this sort invalid, is shown by the fact that if the existence of the subject-matter is uncertain, and the parties know of such uncertainty, and entered into a contract by which the risk of its non-existence is placed upon one or the other of the parties, such transaction is valid whether the subject-matter exists or not.6 If the parties to a transaction involving realty are aware that they are ignorant of the condition of the title, failure of title is not regarded as impossibility.7
Ohio. Cook v. Andrews, 36 0. S. 174; Brick Co. v. Pond, 38 0. S. 65.
Pennsylvania. Muhlenberg v. Henning, 116 Pa. St. 138, 9 Atl. 144; Mc-Cahan v. Wharton, 121 Pa. St. 424, 15 Atl. 615; Boyer v. Fulmer, 176 Pa. St. 282, 35 Atl. 235; Bannan v. Graeff, 186 Pa. St. 648, 40 Atl. 805.
Texas. Edwards v. Trinity B. V. Ry. Co., 54 Tex. Civ. App. 334, 118 S. \V. 572; St. Louis S. W. Ry. Co. v. Johnston, 58 Tex. Civ. App. 639, 125 S. W. 61.
Virginia. Virginia Iron, Coal & Coke Co. v. Graham, - Va. - 98 S. E. 639.
Washington. Adams v. Washington Brick, Lime & Mfg. Co., 38 Wash. 243, SO Pac. 446.
3 England. Bingham v. Bingham, 1 Ves. Sr. 126.
Iowa. Lewis v. Mote, 140 Ia. 698, 119 N. W. 152.
Minnesota. Houston v. Northern Pacific Ry. Co., 109 Minn. 273, 123 N. W. 922.
South Carolina. Lawrence v. Beaubien, 2 Bail. L. (S. Car.) 623, 23 Am. Dec. 155.
Texas. Pegues v. Haden, 76 Tex. 94, 13 S. W. 171.
4 See Sec. 657 to 659.
5 See Sec. 261 et seq.
6 Georgia. Woodside v. Lippold, 113 Ga. 877, 84 Am. St. Rep. 267, 39 S. E. 400.
Iowa. Morgan v. Messenger, 125 Ia. 247, 101 N. W. 127.
Michigan. Valley City Milling Co. v. Prange, 123 Mich. 211, 81 N. W. 1074.
Pennsylvania. Gormly v. Gormly, 130 Pa. St. 467, 18 Atl. 727; Ancient Order of United Workmen v. Mooney, 230 Pa. St. 16, 79 Atl. 233.
Texas. Houston & Texas Central, etc., Ry. Co. v. McCarty, 94 Tex. 298, 86 Am. St. Rep. 854, 53 L. R. A. 507, 60 S. W. 429 [reversing, 21 Tex. Civ. App. 568, 54 S. W. 421].
Wisconsin. Kowalke v. Milwaukee Electric Ry. & Light Co., 103 Wis, 472, 74 Am. St. Rep. 877, 79 N. W. 762.
If the alleged subject-matter never existed, or has ceased to exist, exist, and the parties both know such fact, the contract is not regarded as invalid because of impossibility or mistake. It may be invalid if such alleged subject-matter was the only consideration for the promise which it is sought to enforce, but the invalidity of the contract in cases of this sort is due to lack of consideration, and not to mistake or impossibility.
If the subject-matter is one which might possibly exist, the fact that it is not shown to exist does not seem to be regarded as sufficient to show original impossibility.8 A contract to sell salmon packed in Alaska, to be "exactly like Puget Sound fancy Sockeye," has been held to be valid, although such fish had not been found in Alaska, since it was not shown to be impossible that they should exist there.9
 
Continue to: