Conditions in Contracts: Definition & Forms

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  • 0:06 Contract Conditions
  • 1:19 Condition Precedent
  • 2:25 Condition Concurrrent
  • 3:59 Condition Subsequent
  • 5:41 Lesson Summary
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Lesson Transcript
Instructor: Ashley Dugger

Ashley has a JD degree and is an attorney. She has taught and written various law courses.

The conditions of a contract determine the parties' obligations. A condition is an act or an event that affects the parties' contractual duties. There are three different forms of contract conditions. This lesson explores each of those conditions.

Contract Conditions

Contracts are common in the business world. A contract is a type of legally binding written or spoken agreement. A valid contract will create a mutual obligation. This means that each of the parties is obligated, or required, to perform a duty under the contract.

The contract conditions determine the parties' obligations. A condition is an act or event that affects a party's contractual duty. It is a qualification that is placed on an obligation. For instance, let's say that I promise my brother that I'll wash the dog if he'll clean my room. This agreement has a condition. I'm not obligated to wash the dog unless my brother cleans my room.

There are three different forms of conditions. These conditions are categorized by the point in time that the condition must occur. There are conditions that must occur:

  • Before
  • During, or
  • After the contractual duty

Let's look at each of these forms of conditions.

Condition Precedent

Sometimes a contract will require that a certain act or event occur before some other act or event. This form of condition is known as a condition precedent. A condition precedent is something that must occur before a party is obligated under the contract. The condition precedes the party's obligation.

This type of condition is common. Contracts often stipulate that a party's obligation occurs once another act or event occurs. For example, let's take a look at my oral agreement with my brother. I promise my brother that I'll wash the dog if he'll clean my room. This agreement has a condition precedent. I'm not obligated to wash the dog unless my brother cleans my room. My brother must clean my room before I'm obligated to wash the dog. The clean room is a condition precedent. Once my brother cleans my room, I'm obligated to wash the dog. Until then, I have no obligation.

Condition Concurrent

The second form of contract condition is one that must occur at the same time as some other act or event. This is known as a condition concurrent. A condition concurrent is something that must occur simultaneously with another condition. Each party's obligation acts as a condition precedent for the other.

When there is a condition concurrent, the parties' obligations are mutually dependent on each other. Neither party has an obligation until the other party performs his or her obligation. For example, let's say that I make an oral agreement with my brother. As long as he cleans my room every week, I'll wash the dog every week. This is a condition concurrent because we are mutually obligated to one another and our obligations are mutually dependent on each other. As long as he's cleaning my room, I'm obligated to wash the dog. As long as I'm washing the dog, he's obligated to clean my room.

This is a common contract condition in the sale of goods or services. When I buy a new shirt in a store, I'm obligated to pay the storekeeper and she's obligated to give me the shirt. Or, if I purchase the shirt online, I'm obligated to send payment to the store and the store is obligated to send me the shirt. The obligations are concurrently contingent on one another.

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