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20180524 What is contingent contract?

20180524 (Thu)

What is a contingent contract? Is that “time is an essence” a contingent contract?

In case where the tenant says he will only RENT the premises after the landlord has clear the junk – is clearing of the junks contingent to the tenancy contract?

Yes. S.32 CA50 spells out a “contingent contract” is a contract to do or not to do something, if some event, collateral to the contract, does or does not happen.

In the above example, when clearing the junk does not happen, the tenancy does not form. Thus, clearing of junk is contingent to the contract of tenancy.

Then, as “time is an essence” is not mentioned, any time of his clearing of the junk can be accepted. However, this time is a reasonable time. It cannot be 3 months to clear the junk, so clearing of junk is contingent to the tenancy, and time is a reasonable time frame.

So, “time is an essence” and “contingent” to a contract is an important determinant of a valid contract. Not doing things as promised will lead to invalidate the contract, especially the promisee (or tenant in the above case) is disadvantaged.

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