Tuesday, 9 August 2011

Write a comprehensive note on the contingent or conditional contracts and in which circumstances these are enforceable?

Contingent or Conditional Contracts :-
If any contract performance depends upon the happening or not happening of the some uncertain event of future is called contingent contract.

Example :- Mr. Anwar contracts to Miss. Razia to pay Rs. one thousand if her father dies next month. Same is the situation with the insurance contract.

Essential of Contingent Contract :-

1. The basic essential for the contingent contract is that its performance depends upon the happening or non-happening of uncertain future.

2. Contingency depends upon the act of the party and not on the wish of the party.

3. Contingency condition is also necessary. The happening or non-happening of the event must collateral to the subject matter of the contract.


1. Happening of Uncertain Events :-
It is defined in the following words, "Contingent contract to do or not to do anything if an uncertain future event happens can not be enforced by law unless and until that event has happened. If the event becomes impossible such contract becomes void."

Example :- Mr. Hashim contracts to give his all property to Mr. Smith when he marries with his daughter Miss. Sonia. Miss. Sonia dies before marriage. The contract becomes void.

2. Unhappening of Uncertain Events :-
Its defined in this regard, "Contingent contract to do or not to do anything if an uncertain events does not happen can be enforced when the happening of that event becomes impossible and not before."

Example :- Mr. Kallis agrees to pay Mr. Peter Rs. ten thousand if samjhota express train does not return from India. The train is destroyed. The contract can be enforced when the train is destroyed.

3. Impossible Event :-
It is defined in these words, "Contingent agreements to do or not to do anything if an impossible event happens are void where the impossibility of the event is known or not to the parties to the agreement at the time when it is made."

Example :- Mr. Ricky says to Mr. Symonds to pay Rs. 5 thousand it two straight lines are enclosed a space. This agreement is void.

4. Time Not Specified :-
It is defined in the following words, "If the future event on which the contract is contingent is the way in which the person will act at an unspecified time, the event shall be considered to become impossible when such person does anything which renders it impossible ." It will be a void contract.

Example :- Mr. Micheal agrees to pay Miss. Kiran a sum of money if she marries to Mr. Daniel. Mr. Daniel marries to Miss. Neha. Now the marriage between Miss. Kiran and Mr. Daniel is not possible. Although it is possible if Miss. Neha dies and Miss Kiran afterwards marry with Mr. Daniel.

5. Time Specified or Fixed :-
It is defined as, "Contingent contracts do or not to do anything if a specified uncertain event happens within a fixed time becomes void, If at the expiration of the fixed time such event has not happened or if, before the time fixed."

Example :- Mr. Shapered promises to pay Miss. Tina sum of Rs. 10 thousand if Super express returns to Lahore within 24 hours. The contract is enforceable if train returns within a fixed period. On the other hand if train destroys during the fixed period the contract will be void.

6. Fixed Time Expired :-
It is defined as, " Contingent contracts to do or not to do anything if a specified uncertain event does not happen within a fixed time may be enforced by law when time fixed has expired and such event has not happened or before the time fixed has expired, it becomes certain that such event will not happen."

Example :- Mr. Rose promised to pay Miss. Pinky one thousand dollar if Air Bus 707 does not return from Bombay to Goa within four hours, contract will be enforceable. On the other hand if it is destroyed within four hours contract will be void.


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