Contingent contract
Open-knowledge reference entry
A contingent contract or "contingency contract" is an agreement that states which actions under certain conditions will result in specific outcomes. Contingent contracts usually occur when negotiating parties fail to reach an agreement. The contract is characterized as "contingent" because the terms are not final and are based on certain events or conditions occurring.
A contingent contract can also be viewed as protection against a future change of plans. Contingent contracts can also lead to effective agreement when each party has different time preferences. For example, one party may desire immediate payoffs, while the other party may be interested in more long-term payoffs. Further, contingency contracts can foster an agreement in negotiations involving resolute differences of expectations about the future.
Definition
An example of a definition can be found in Section 31, chapter III of the Indian Contract Act, 1872, which defines a contingent contract:
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.
Uses
Contingent contracts can be used in many types of settings such as work, school, home, etc. In regards to work, a common example of contingent contracts comes in the form of job negotiations.
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The citation trail is more important than the brevity of the summary: it shows where individual claims can be examined in context. The source revision retrieved here is dated Sep 7, 2026. The linked authority identifier is Q2534642. The Library of Congress control number is sh85031633. 1 of 1 selected statements include explicit references; 1 carry qualifiers and 0 use preferred rank. The first chronological checks are 1872.
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This entry incorporates text from “Contingent contract” on English Wikipedia. Contributors are listed in the page history. Text is available under the Creative Commons Attribution-ShareAlike 4.0 License. Selected authority identifiers and statements are retrieved from Wikidata under CC0; their references and qualifiers remain part of the verification path.