Ellis A. SECHREST, trading and doing business as Sechrest Plywood Company,
v.
FOREST FURNITURE COMPANY, a corporation.
No. 438.
Supreme Court of North Carolina.
April 7, 1965.*293 Adams & Dearman, Statesville, by C. H. Dearman, Statesville, for plaintiff appellant.
McElwee & Hall, North Wilkesboro, by W. H. McElwee, North Wilkesboro, for defendant appellee.
HIGGINS, Justice.
The plaintiff alleged a contract, its performance, defendant's breach, and the amount of plaintiff's damage resulting from the breach. The complaint stated a cause of action. The defendant admitted the contract but by way of defense alleged the factory, in which it intended to use the drawer bottoms, burned without its fault; and that the purposes of the contract were frustrated by the fire; and the defendant should be released from performance for that reason.
"In the obligations assumed by a party to a contract is found his duty, and his failure to comply with the duty constitutes *294 the breach." Sale v. State Highway and Public Works Commission, 242 N.C. 612, 89 S.E.2d 290. "`Non-performance of a valid contract is a breach thereof * * unless the person charged shows some valid reason which may excuse the non-performance; and the burden of doing so rests on him'." Blount-Midyette & Co. v. Aeroglide Corp., 254 N.C. 484, 119 S.E.2d 225.
In this case the defendant and the court have misconstrued the applicability of the frustration of purpose doctrine as recognized by this Court. The subject of the contract was the special manufacture of plywood drawer bottoms. They were not burned. The doctrine of frustration would be available to the defendant if it had contracted to sell the factory and it burned before the execution of the deed. In that event the defendant properly could plead frustration in a claim for failure to convey the factory. The doctrine of frustration is clearly stated in Sale v. State Highway and Public Works Comm., supra: "`Where parties contract with reference to specific property and the obligations assumed clearly contemplate its continued existence, if the property is accidentally lost or destroyed by fire or otherwise, rendering performance impossible, the parties are relieved from further obligations concerning it. * * * Before a party can avail himself of such a position, he is required to show that the property was destroyed, and without fault on his part.'"
In Steamboat Co. v. Transportation Co., 166 N.C. 582, 82 S.E. 956, the contract involved chartering the steamship for Sunday excursion runs. The destruction of the ship by fire rendered further performance impossible and released the parties from obligations thereafter. In Sale v. State Highway and Public Works Comm., supra, the contract to remove the building was rendered impossible of performance when the building burned. In Blount-Midyette & Co. v. Aeroglide Corp., supra, the elevator was destroyed by fire before repairs were completed.
The plaintiff was in nowise responsible for the fire that destroyed defendant's building. The defendant is bound by its contract. The destruction of its factory does not relieve it of liability for its debts. At the trial the parties will have opportunity to contest the amount due under the contract.
The defendant's factual allegations are insufficient to support its plea of frustration. The plaintiff's motions to strike should have been allowed. The trial court committed error in sustaining the demurrer ore tenus. The judgment in the court below is
Reversed.