Frustration of purpose occurs when a supervening event voids the contract's principal purpose, even if performance is still physically possible.

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Frustration of purpose arises when a supervening event destroys the contract’s main reason for entering into it, so performance can still occur but the central purpose no longer exists. That’s why the best option is the event that destroys the principal purpose—because the contract is discharged not due to impossibility or illegality, but because the fundamental objective of the deal has vanished. This differs from situations where performance becomes illegal or physically impossible, or only prohibitively costly; those scenarios fall under impossibility or impracticability, not frustration of purpose. For example, if you rent a hall to view a coronation procession and the procession is canceled, the main purpose of the contract is lost, even though the hall is usable and the rental could still be performed.