subject: Contingent Under CONTRACT Laws [print this page] 1. INTRODUCTION:1. INTRODUCTION:
If any contract performance depends upon the happening or not happening of certain event of future is called contigent contract.
An ordinary contract can become contingent contract. If its performance is made dependent upon the happening or non happening of an uncertain event, collateral to such contract contigent contract is also called conditional contract.
=> Example:
A contracts to pay B Rs. 2000 If B marries to C. This is contigent Contract.
=> Collateral Event:
The collateral event means connected event.
2. ESSENTIALS:
Following are the essentials of the conditional contract, (i) the performance of such contract depends upon
the happening or non happening of some future
uncertain event, (ii) The event must be uncertain, (iii) The happening or non happening of the event
must be collateral.
3. RULES OF THE PERFORMANCE OF CONTIGENT CONTRACT:
Rules of the performance of contigent contract are following.
(I) HAPPENING OF UNCERTAIN EVENT:
According to Sec. 32
"contigent contracts to do or not to do anything If an uncertain future event happens cannot be enforced by law, unless and until that event happened. If the event becomes impossible, such contract becomes void.
=> Example:
A contracts to pay B a sum of 100,000/- when B marries C. C dies without being married to B. The contract becomes void.
(II) UNHAPPENING OF UNCERTAIN EVENTS:
According to Sec. 33
"Contigent Contract to do or not to do anything If an uncertain future event does not happen can be enforced when the happening of that event becomes impossible but not before.
=> Example:
"A agrees to pay B a sum of money If a certain ship does not return. The ship is sunk the contract can be enforced when the ship sinks.
(III) TIME NOT SPECIFIED:
According to Sec. 34.
"If the future event which the contract is contigent is the way 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:
A agrees to pay B a sum of money If B marries to C. But c marries to D. The marriage of B to C must now be considered impossible. Although it is possible that D. may die an C may afterwards marry B.
(IV) TIME SPECIFIED:
According to Sec. 35(1)
Contigent contracts to do or not to do anything If a specified uncertain event happens with In a specified time become a void. If at the expiration of the fixed time such event has not happends or before the time fixed.
=> Example:
A promises to pay B a sume of money If train returns to Karachi within 24 hours. The contract is enforceable If train returns with in specified time. But If train destroys during the fixed time the contract will be void.
(V) fixed time expired:
Sec 35(2)
"Contigent contracts to do or not to do anything II a specified uncertain event does not happened with in a fixed time may be enforced by law: when time 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:
A promises B to pay a sume of money If certain I train does not return within a day. The contract may be enforced If train does not return.
(VI) IMPOSSIBLE EVENT:
According to sec 36.
"Contigent agreement to do or not to do anything If an impossible event happens are void whether the impossibility of the event is known or not to the parties to the agreement at the time when it is made.
=> Example:
A agrees to pay B a sum of money if B will marry A's daughter's C. C was dead at the time of agreement. It is void.
4. CONCLUSION:
To conclude I can say that, Contigent contract is also known as conditional contract. It is valid contact. The parties have real interest in the occurrence or non occurrence of the event. Contracts of guarantee, indemnity and insurance are its example.
