Question

Which of the following is not correct about the nature of contingent contract?

• A. A contract contingent upon the happening of an event can be enforced after that event occurs.
• B. A contract contingent upon the happening of an event can be enforced even before that event occurs.
• C. If the event becomes impossible, the contract becomes void.
• D. The parties are under no obligation till the happening of that event unless there is a term requiring the parties to make effort to make that event happen.
• A. The contract can be enforced when the cruise sinks.
• B. Sinking of cruise has no relevance for validity of contract.
• C. The contract cannot be enforced when the cruise sinks.
• D. The condition is impossible.
• A. No contract comes into existence until the contingency occurs.
• B. One party cannot assume an immediate unilateral obligation subject to a condition.
• C. The parties cannot enter into an immediately binding contract; and either the operation of the contract is made to depend upon the happening of the specified event.
• D. All contingent contracts are void.
• A. The contract becomes void if the ship is burnt within the year.
• B. The contract depends upon returning or non-returning of the ship.
• C. The contract may be enforced if the ship returns within the year.
• D. The contract cannot be enforced if the ship returns within the year.
• A. The agreement is valid.
• B. The enforceability of agreement does not depend on the existence of ‘B’.
• C. The agreement is void.
• D. The event is possible in its nature.
• A. Wagering agreements are void and contingent contracts are valid.
• B. Wagering agreements are valid and contingent contracts are void.
• C. Wagering agreements and contingent contracts are valid.
• D. Wagering agreements and contingent contracts are void.

Answer 1

The Correct Option is B

Step 1: Understanding contingent contracts.
Under Sections 31–36 of the Indian Contract Act, 1872, a contingent contract depends on the occurrence (or non-occurrence) of a future uncertain event. It can only be enforced after the event has happened (if the condition is based on occurrence) or when it becomes certain that the event will not happen (if based on non-occurrence).
Step 2: Why Option B is incorrect.
A contingent contract cannot be enforced before the event occurs. Doing so would defeat the essence of contingency — the contract’s enforceability hinges on the event actually happening (or not happening).
Step 3: Verification of other options.
(A) Correct — matches Section 32.
(C) Correct — impossibility of the event makes the contract void (Section 32).
(D) Correct — unless expressly agreed, no obligation arises before the event.
\[ \boxed{\text{B}} \]

Answer 2

Step 1: Identifying the condition.
The contingency is “cruise does not return.” Sinking of the cruise makes it certain that it will not return.
Step 2: Application of law.
As per Section 32 of the Indian Contract Act, when the contingent event happens (or its non-happening becomes certain), the contract becomes enforceable. Here, the non-return is certain, hence enforceable.
Step 3: Elimination.
(B) Incorrect — the event is central to enforceability.
(C) Incorrect — contract is enforceable once condition is fulfilled.
(D) Incorrect — condition is not impossible; it has occurred.
\[ \boxed{\text{A}} \]

Answer 3

Step 1: Nature of contingent contracts.
A contingent contract is a valid contract but its operation (performance) is dependent on the happening or non-happening of a specified uncertain future event.
Step 2: Why Option C is correct.
Parties may agree to a binding contract whose execution depends on the event’s occurrence. This is the classic structure of a contingent contract.
Step 3: Eliminating wrong options.
(A) Incorrect — the contract exists from the start, only enforceability is postponed.
(B) Incorrect — contingent contracts can impose obligations, subject to event occurrence.
(D) Incorrect — contingent contracts are valid unless the event becomes impossible.
\[ \boxed{\text{C}} \]

Answer 4

Step 1: Identifying the contingency.
The condition for enforceability is the ship returning within a year.
Step 2: Application of law.
As per Section 32 of the Indian Contract Act, when a contract is contingent on the happening of a specified event, it becomes enforceable when that event occurs. If the ship returns within the year, the condition is satisfied, hence the contract is enforceable.
Step 3: Elimination.
- (A) Correct — if the ship is burnt, the event becomes impossible and the contract void.
- (B) Correct — enforceability depends on return or non-return.
- (C) Correct — ship returning makes it enforceable.
- (D) Incorrect — contradicts the rule, hence the answer.
\[ \boxed{\text{D}} \]

Answer 5

Step 1: Understanding impossibility.
The agreement’s enforceability depends on ‘Z’ marrying ‘B’. Since ‘B’ was already dead when the contract was made, the event is impossible from the outset.
Step 2: Application of Section 36.
Section 36 of the Indian Contract Act states that a contingent agreement to do something if an impossible event happens is void, regardless of whether the parties knew of the impossibility.
Step 3: Eliminating wrong options.
(A) Incorrect — an impossible condition voids the agreement.
(B) Incorrect — the event is entirely dependent on ‘B’ being alive.
(D) Incorrect — the event is not possible.
\[ \boxed{\text{C}} \]

Answer 6

Step 1: Understanding wagering agreements.
A wagering agreement is one in which two parties bet on the occurrence or non-occurrence of an uncertain event, with no interest in the event other than winning or losing money. Under Section 30 of the Indian Contract Act, wagering agreements are void.
Step 2: Understanding contingent contracts.
A contingent contract is a valid contract whose performance depends on the occurrence or non-occurrence of a specific uncertain event, and the parties have a genuine interest in the event.
Step 3: Conclusion.
Thus, wagering agreements are void, while contingent contracts are valid if they meet the conditions of Sections 31–36. \[ \boxed{\text{A}} \]