Which of the following is NOT a termination reason for an agency contract?

• A. Death of one party
• B. Frustration
• C. Completion of contract
• D. Insanity of the agent or principal

Answer: (C)

The key idea is how an agency relationship ends. Some events automatically break the agency regardless of what the contract says: if one party dies, the agency usually cannot continue; if either party becomes insane, they lack the capacity to deal with the other party, so the agency ends; and if a frustrating event makes performance impossible or materially different from what was contemplated, the contract is terminated by frustration.

Completion of the contract, however, is simply the natural end when the agency has done what it set out to do or when the contract’s term expires. It is not an independent, triggering event that terminates the relationship; it’s the end state from performing the contract. Therefore, completion of the contract is not a termination reason in the same sense as death, insanity, or frustration.