## Facts

- A buyer (Sechrest, doing business as Sechrest Plywood Company) contracted with a seller/manufacturer (Forest Furniture Company) for the special manufacture of plywood drawer bottoms.
- The seller admitted the existence of the contract but did not perform as promised.
- After the contract formed, the seller’s factory—where it intended to use the drawer bottoms—burned without the seller’s fault.
- The seller asserted that the fire frustrated the contract’s purpose and discharged its duty to perform.
- The contracted goods (plywood drawer bottoms) were not alleged to have been destroyed, and the contract was not for the factory itself.

## Issues

1. Whether destruction by fire of the seller’s factory, where it intended to use the goods, discharged the seller’s contractual duty under the doctrine of frustration of purpose/impossibility.

## Decision

- The Supreme Court of North Carolina reversed the judgment for the seller.
- The court held that the frustration/impossibility doctrine did not apply because the contract’s subject matter (specially manufactured drawer bottoms) was not destroyed.
- The buyer’s complaint sufficiently stated a breach-of-contract claim, and the seller was not discharged from performance based solely on the factory fire.
- The case was remanded for further proceedings.

## Legal Principles

- A party’s contractual duty is defined by the obligations it assumed; nonperformance is a breach unless a legally recognized excuse is shown.
- The party asserting an excuse for nonperformance bears the burden of proving it.
- Frustration/impossibility applies when the contract is made with reference to specific property whose continued existence is clearly contemplated, and that property is accidentally destroyed without the party’s fault, rendering performance impossible.
- Destruction of a party’s facilities or a collateral circumstance affecting intended use does not discharge performance when the contract’s subject matter remains available and performance is still objectively possible.

## Conclusion

The court held that a seller could not avoid a manufacturing-and-delivery obligation merely because its own factory burned; absent destruction of the contract’s specific subject matter or objective impossibility, the seller remained bound and could be liable for breach.


Sechrest v. Forest Furniture Co., 141 S.E.2d 292 (N.C. 1965)