What occurs when impossibility is unknown to both parties involved in a contract?

In contract law, when impossibility arises that is unknown to both parties, the situation can lead to the contract being viewed as void. This is because the fundamental premise of the contract—the ability to perform the obligations outlined in it—has been compromised due to unforeseen circumstances that neither party anticipated.

When parties enter into a contract, there is a mutual understanding that the obligations can be fulfilled. If an unexpected event occurs that makes performance impossible and this impossibility was not knowable at the time of contract formation, the law acknowledges that the parties cannot be held to their obligations. Thus, the contract is considered void, as it is no longer possible to execute the terms as agreed.

In contrast, the other options suggest scenarios where the contract could be enforceable or modified, which does not align with the principle of impossibility that fundamentally alters the rights and responsibilities instantiated in the contract. The doctrine of impossibility essentially provides a legal recourse for parties in situations where the performance conditions have been irrevocably disrupted.