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Bose Traders agrees to pay Reddy Rs. 50,000 if a specified ship returns within a year. The ship is burnt in the sixth month. Which is correct?

The contract becomes void. Where a contract depends on a specified event happening within a fixed time, it becomes void if the event becomes impossible before the time expires, and the burning of the ship makes its return impossible.

  1. AThe contract is enforceable after the year ends
  2. BThe contract becomes void, because the event became impossible before the time fixedCorrect
  3. CThe contract is enforceable at once, since the ship is lost
  4. DThe contract is voidable at Reddy's option

Explanation

Section 35 says contingent contracts dependent on a specified uncertain event happening within a fixed time become void if, before the time fixed, the event becomes impossible. Burning of the ship makes return impossible, so the contract becomes void at that point, as in illustration (a).

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