Section 32 of Indian Contract Act

32. Enforcement of contracts contingent on an event happening.— Contingent contracts to do or not to do anything if an uncertain future event happens cannot be enforced by law unless and until that event has happened.

If the event becomes impossible, such contracts become void.

Illustrations

(a) A makes a contract with B to buy B’s horse if A survives C. This contract cannot be enforced by law unless and until C dies in A’s lifetime.

(b) A makes a contract with B to sell a horse to B at a specified price, if C, to whom the horse has been offered, refuses to buy him. The contract cannot be enforced by law unless and until C refuses to buy the horse.

(c) A contracts to pay B a sum of money when B marries C. C dies without being married to B. The contract becomes void.

Final Thoughts

Introduction

A contingent contract is a contract whose performance depends on the happening or non-happening of an uncertain future event. Unlike ordinary contracts where obligations are immediate, contingent contracts are conditional and depend on events that may or may not happen.

Meaning of Section 32

Section 32 of the Indian Contract Act states that contracts which depend on a future uncertain event cannot be enforced by law until that event actually happens. If the event on which the contract depends becomes impossible, the contract automatically becomes void.

Key Features of Section 32

• The contract is conditional on an uncertain future event.
• The contract cannot be enforced unless the event occurs.
• If the event becomes impossible to happen, the contract is void.
• The event can be either happening or non-happening of the event.

Legal Implications of Contingent Contracts

The law protects parties from obligations they are not sure about by making contingent contracts enforceable only when the event happens. This avoids forcing a party to fulfill a promise based on an event that never occurs or cannot occur.

When Contingent Contracts Become Void

If the uncertain event on which the contract depends does not happen because it is impossible, then the contract becomes null and void automatically. This means the parties are no longer bound by the contract.

Illustrations and Explanation

(a) Contract: A agrees to buy B’s horse if A survives C.

• Here, the contract depends on A surviving C (an uncertain future event).
• If C dies while A is alive, the contract becomes enforceable.
• If C dies after A, or if the event (A surviving C) never happens, the contract cannot be enforced.

(b) Contract: A agrees to sell a horse to B if C refuses to buy it.

• The contract depends on C’s refusal, which is uncertain.
• If C refuses to buy, the contract becomes enforceable.
• If C buys the horse or the refusal never happens, no contract enforcement is possible.

(c) Contract: A promises to pay B money when B marries C.

• The contract depends on B marrying C.
• If C dies without marrying B, the event (marriage) cannot happen.
• Therefore, the contract is void and cannot be enforced.

Conclusion

Section 32 safeguards parties by making contingent contracts enforceable only when the uncertain future event on which they depend occurs. This prevents unfair enforcement of promises based on uncertain conditions. If the event becomes impossible, the law treats the contract as void, releasing parties from obligations.