Q.
When a contingent contract is done between Ali and Abu on a deal of purchasing Abu's house, Ali did not know Abu would get into trouble not able to return to Malaysia. So, what would happen to the contract?
A.
See contingent contracts here and
Scenario 1 here,
Scenario 2 here, and
Scenario 3 here,
Ali can wait, until Abu returns to Malaysia to carry out the contract. Or he can revoke the contract based on the specific timing to enforce the contract (if Abu does not return).
The essence of the case is 'TIME'.
How long to wait until Abu returns? Or he will never ever return?
S.35 may provide guidance.
S.35 When event on which contract is contingent to be deemed impossible, if it is the future conduct of a living person.
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 he should so act within any definite time, or otherwise than under further contingencies.
The future conduct of Abu is the key issue of this case. If Abu could return, within a specific time, then the contingent contract can be enforced. If he could not, then the event is impossible to happen. Hence, the contingent contract is void (S.36).
S.36 When contracts become void which are contingent on happening of specified event within fixed time.
(1) 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, the event has not happened, or if, before the time fixed, the event becomes impossible.
Ref:
S.35 & 36, Contracts Act 1950.
Earlier posts.