There exists a large body of Court and Board decisions dealing with the concept of impossibility or commercial impracticability of performance.

"Impossibility means not only strict impossibility but impracticability because of extreme and unreasonable difficulty, expense, injury or loss involved"

Restatement of Contracts §454

"Legal impossibility may be established without showing actual or literal impossibility. Thus a finding of legal impossibility may be based on ‘commercial impracticability’... As noted before, practical impossibility need not be actual impossibility. It can be such that it is economically infeasible or it is not possible to construct within either the allotted or a reasonable construction time. As best expressed, practical impossibility means that the result asked for is not possible within the basic objectives contemplated by the parties so as to amount to commercial senselessness"

Soletanche Rodio Nicholson (JV), ENGBCA Nos. 5796, 5891, BCA ¶ p.102176-102177

"The true distinction is not between difficulty and impossibility. A man may contract to do what is impossible, as well as what is difficult, and may be liable for failure to perform. The important question is whether an unanticipated circumstance has made performance of the promise vitally different from what should reasonably have been within the contemplation of the parties when they entered into the contract."

6 Williston, Contracts, § 1931

"Where, at the time a contract is made, a party’s performance under it is impracticable without his fault because of a fact of which he has no reason to know and the non-existence of which is a basic assumption on which the contract is made, no duty to render that performance arises, unless the language or circumstances indicate the contrary."

Commercial impracticability exists even if the contract is ultimately possible of successful performance, but "which could not be accomplished without commercially unacceptable costs and time input far beyond that contemplated in the contract"

Foster Wheeler Corporation v. United States, 513 F.2d 588, 598 (Ct.Cl. 1975)

See also:

Commercial impracticability has also been established when it was economically impracticable to supply an item when the costs incurred would be so great that buyers for the item would not be willing to pay such a price.

Brazier Lumber Co., ASBCA No. 18601, 76-2 BCA ¶ 12207

"...[C]onsideration must be given to several salient elements supporting the conclusion of extreme expense, injury or loss which bespeaks commercial senselessness in requiring further performance... In this context we have examined the entire period of actual performance which greatly exceeded the period prescribed under this formally advertised production contract; the involvement of this contractor in extensive research development, the degree of experimental effort not within the contemplation of the parties to this contract; and the disproportionate outlay of expenditures in relation to the contract price."

Whittaker Corp., Power Sources Div., ASBCA Nos. 14740, 14191, 15628, 14722, 15005, 79-1 BCA ¶13805

"Several factors have been considered in evaluating a claim of commercial impossibility, including: 1) whether any other contractor was able to comply with the specifications; 2) whether the specifications require performance beyond the state of the art; 3) the extent of the contractor’s efforts in meeting the specifications; and 4) whether the contractor assumed the risk that the specifications may be defective."

Oak Adec, Inc. v. U.S., 24 Cl.Ct. 502, 504

"The doctrine of impossibility involves an examination of such factual consideration as: (1) the nature of the contract; (2) the nature of the specifications; (3) the extent of the contractor’s effort; (4) the capability of other contractors to meet the specification requirements; (5) the significance of design choices made by the contractor; and (6) the effect of workmanship on production."

Whittaker Corp., Power Sources Div., ASBCA Nos. 14740, 14722, 15628, 15005, 79-1 BCA ¶ 13805, p. 41630

1. Nature of the Contract and Specifications

        When no state of the art advancement or significant research and development efforts were envisaged by the contract terms, as evidenced by the lack of pre-award communications, which were conducive to the discussions of potential problems or past difficulties, commercial impracticability can arise.

Whittaker, supra.

        The existence of mandatory design features of a constrictive nature, may give rise to the presumption of commercial impracticability, even when the design features occur within a performance specification. This is especially true when the design and performance criteria are inextricably related.

2. Extent of Contractor’s Efforts in Meeting the Specifications

"The doctrine of commercial impracticability does not impose the burden of continued experimentation until there is a certainty that success is not obtainable. There must, however, be a showing that the contractor could succeed only if excessive and unreasonable costs were to be expended."

Koppers Co. v. U.S. 405 F.2d 554, 566

3. Capability of Other Contractors to Meet Specification Requirements

When no other supplier succeeded in performing the contract under the same time and technical requirements as the contract in question, is probative of conclusion that the failure of a contractor to perform is not due to the fault or incompetence of the contractor.

Foster Wheeler, supra.

"Eventual relaxation of specification requirements to permit production is also indicative of the impossibility of the original specifications. The Court of Claims and this Board have held that the inability of other manufactures to attain specified performance requirements can be taken as a strong suggestion that such requirements are impossible"

Whittaker, supra at 41635

4. Assumption of the Risk of Impossibility/Impracticability

        The determination as to who assumed the risk of the impossibility is based upon determining which party had the greater expertise and which party took the initiative in drafting the specifications and promoting a particular method or design.

Foster Wheeler, supra.

The party who drafts the specification normally assumes the risk that it is possible to perform.

J.A. Maurer, 485 F.2d at 594-595

        If the specification contains numerous performance requirements, the existence of significant design features may give rise to the presumption that the Government has assumed the risk that the product is not impossible to produce per the contractual terms.

Foster Wheeler, supra.

        Even if a performance specification is involved and the contractor is not constrained by Government-imposed design requirements, a contractor may still have a basis for recovery under the theory of impossibility/impracticability.

        If a specification is determined to be impossible/impracticable, a contractor is entitled to recover all costs incurred, based upon the theory of defective specification, and per the Changes clause to the contract.