Karl Agreed to Sell His Boat to Jeff on July

Karl agreed to sell his boat to Jeff on July 5 for $10,000 and Jeff paid Karl a $1,000 down payment. They arranged to meet at the marina on July 12 to transfer the boat. When they arrived at the marina on July 12 they were shocked to see the boat had been totally destroyed by a huge storm that had swept through the area on July 10. As a result

A) there is a major breach of contract and Jeff can sue for any extra costs he incurs when he buys a replacement boat
B) the contract is void due to innocent misrepresentation
C) the contract is frustrated and Karl must repay the $1,000 to Jeff
D) the contract is breached but Karl can keep the $1,000
E) the contract is void as it is unconscionable