Which Section of Indian Contract Act Provides That Agreement Contingent on Impossible Event Is Void

The section sets out two basic principles. First, a contract to take action in the event of a future uncertainty situation can only be performed if and until that event occurs. [5] Second, if the occurrence of this event has become impossible, the contract becomes null and void. The examples attached to the section illustrate these two principles. “A conditional contract is a contract to do or not to do something when an event certainty that contributes to such a contract occurs or does not occur.” The term “contingent” suggests that anything else or reality depends on an event or situation. The “Conditional Agreement” implies that the applicability of this Agreement depends directly on whether or not an event occurs. In the Indian Contract Act of 1872, the term was used to mean conditional. An agreement to perform an impossible act, either if the impossibility is inherent or is of the nature of the agreement, is not a conditional contract. If a man agrees to pay money to another man while he makes a deceased person alive, it is not a conditional contract and the contract is definitely void.

A conditional contract presupposes the prospect of whether an event occurs or not, not the impossibility of the event occurring and not. The conclusion of a contract whose event cannot occur is just as good as the conclusion of a contract. Conditional contracts consist of doing or not doing something about the occurrence or non-occurrence of a possible event. If a conditional contract is formed for an event that has not occurred, the contract becomes null and void. To make an illustration, Peter promises to pay John Rs 50,000 when the sun rises in the west the next morning. This contract is void because the occurrence of the event is impossible. Another example would be a situation where A agrees to pay B Rs.1,000 if two straight lines are to surround a space. The agreement is void because the occurrence of this event is impossible. Another example of this situation would be if A agrees to pay B if B marries A,C`s daughter. What A B did not say was that by the time this deal was made, A, C`s daughter was dead. We see in this figure a situation of impossible event, and therefore this agreement is null. A conditional contract can be the promise to pay money if a person wins a lawsuit.

A promise to pay money when a person draws two straight lines in a closed space is an agreement to do an “impossible action” and is void. So we can clearly see how different these two agreements are. The possibility of the event is the most important aspect of a conditional contract, and the agreement to perform impossible actions negates this characteristic of a contingent contract. If, on the other hand, the application for action was subject to the condition that the applicant pay nothing until the dividends had been paid by the company, the contract was not regarded as a conditional contract. A valid contract had already been drawn up; only payment in respect of it was deferred until a condition was fulfilled. All the fundamental aspects must be present for an agreement to be a conditional agreement. These components form a conditional contract and a contract is not contingent without them. To do or not to do something, there must be a legitimate contract. The execution of the agreement must be subject to conditions.

The event should be a security for these transactions, and the event should not be at the mercy of those who are promising. Here are some rules that must be followed for the applicability of a conditional contract. For example, about the occurrence of an event, about the event that does not occur, and about the event that does not occur in a certain time. Enter into or refrain from entering into conditional contracts if an uncertain future event occurs within a certain period of time. Such a contract is void if the event does not occur and time passes. It is also not valid if, before the specified time, the event becomes impossible. [§ 35(1)] A contract is no less conditional if the occurrence or non-occurrence of the contingency depends on the will of a party. In Secy of State of India v. A.J. Arathoon.

[3] The case involved the supply of wood to a government agency. Like what. B if a person applied for shares in a corporation that was subject to his or her appointment as cashier of the corporation, it was determined that no shares could be attributed to him or her without first appointing him or her as a cashier. The event occurring or non-occurrence on which the event on which the performance of the contract depends should not be part of the contractual consideration depends. The occurrence or non-occurrence of the event should constitute security for the contract and should exist independently of each other. Emergency contracts to do or refrain from doing anything if an uncertain future event does not occur can be applied when the occurrence of that event becomes impossible, and not before. Illustration: Saurbh promises to pay Servesh if a particular ship returns within a year. The contract expires if the ship is burned within one year. 1. Abhay Pandey: Conditional contracts under the Indian Contracts Act, ipleaders.

( September 21, 2018), available from blog.ipleaders.in/contingent-contract/. . . .