Doctrine of Unforeseen Circumstances

Plain English

The doctrine of unforeseen circumstances allows courts to adjust or release parties from a contract when something major happens that neither party anticipated when they signed. This doctrine is more flexible than impossibility or impracticability—it focuses on whether the parties would have agreed to the same terms if they'd known about the change. It's used to prevent harsh or unfair results when the world shifts in unexpected ways. Different jurisdictions apply it differently, and courts are generally reluctant to use it.

Example

A landlord and tenant sign a 10-year lease at a fixed rent. Five years in, the neighborhood is rezoned and becomes industrial, causing property values to plummet. The tenant might argue unforeseen circumstances to renegotiate the rent, since the character of the area changed dramatically.

Used in a sentence

“The court invoked the doctrine of unforeseen circumstances to modify the contract when the pandemic made the original terms unreasonable.”

Related terms