Engineering Contract Management

Professor Sajid A. Qureshi

Submitted by: Syed Zahid Raza Rizvi (F-09-203) 21st February 2011
Q1. What are contingent contracts? Enumerate the differences and similarities between wagering agreements and contingent contracts. Give Examples. Contingent Contract: It may be defines as conditional contract. Contingent contract is an agreement which will become contract only after fulfilling certain conditions laid down in the agreement. That means the contract is subject to fulfillment of the conditions (contingencies). It is contract to do something or not to do something if event happened or even does not happen A "contingent contract" is a contract to do or not to do something, if some event, collateral to such contract, does or does not happen. Essential Elements: 1. It must be a valid contract. 2. The performance of contract must be conditional. 3. The event must be future uncertain. 4. The event must be collateral to contract. Moreover: Contingent contracts to do or not to do anything in an uncertain future event happen cannot be enforced by law unless and until that event has happened. If the event becomes impossible, such contracts become void. Contingent contracts 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, and not before. If the future event on which a contract is contingent is the way in which a person will act at an unspecified time, the event shall be considered to become impossible when such person does anything which renders it impossible that they should so act within any definite time, or otherwise than under further contingencies. Contingent contracts to do or not to do anything, if a specified uncertain event happens within a fixed time, become void, if, at the expiration of the time fixed, such event has not happened, or if, before the time fixed, such event becomes impossible. When

contracts may be enforced, which are contingent on specified event not happening within fixed time: Contingent contract tutu or not to do anything, if a specified uncertain event does not happen within a fixed time, may be enforced by law when the time fixed has expired and such event has not happened, or before the time fixed has expired, if it become certain that such event will not happen. Contingent agreements 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 agreement at the time when it is made. Wagering Contract: The meaning of wagering is staking something of value upon the result of some future uncertain event, such as a horse race, or upon the ascertainment of the truth concerning some past or present event. A wager generally contemplates a future event; but it may even relate to an event which has already happened in the past, but the parties are not aware of its result or the time of its happening An agreement wherein two parties hold opposite views as to the result of an uncertain event and agree to give consideration upon the happening or non-happening of the event is a Wagering Agreement. Wagering Contract Essentials: It consists of reciprocal promises. It is of contingent nature. It is a void contract. The parties are not interested in the performance of promises but only in paying or receiving the difference. The future event is the sole determinant of the contract. Comparison of Contingent and Wagering Contracts Contingent Contract The contract need not contain any mutual promises. All contingent contracts are not necessarily wager contracts. Uncertainty exists The uncertain event may be within the power of one of the parties. In a contingent contract, the parties are interested in the occurrence of the event. The future event is merely collateral or incidental. Contingent contract is not void unless it is dependent on the occurrence of an impossible event. Examples: Contingent Contracts:
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Wagering Contract The contract is bound by mutual or reciprocal promises. All wager contracts are contingent contracts. Uncertainty exists In a wager, the uncertain event is beyond the power of both the parties. The parties are not interested in the occurrence of the event, apart from the money earned or lost. The future event is the sole determining factor of the contract. Wagers are void.

A contingency contract is an agreement between a student and teacher, which states behavioral or academic goals for the student and reinforces or rewards that the student will receive contingent upon achievement of these goals. A agrees to pay a sum of money to B, if a certain ship does not return. The contract can be enforce when ship is sunk. A makes a contract with B to sell a car to B at a specified price, if C to whom the car has been offered, refuses to buy this car. The contract cannot be enforced by law unless and until C refuses to but the car. Wager Contract: A tells B that X team shall win. B tells A that Y shall win. Both A and B are aware that it is very unlikely there will be match between X and Y and yet they decide that they shall pay the other Rs.1000/- if the team they support loses. Gambling

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