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CS Professional · Drafting, Pleadings and Appearances · Commercial Contract Management

Kaveri Textiles agrees to buy Ramesh's lorry if Ramesh's rival Suresh refuses to buy it. Suresh has not yet decided. Kaveri refuses to pay, and Ramesh seeks to enforce the contract today. What is the legal position?

The contract cannot be enforced until Suresh actually refuses to buy the lorry. A contingent contract dependent on an uncertain future event happening is unenforceable unless and until that event occurs, and it becomes void only if the event becomes impossible.

  1. AEnforceable now, because both parties have consented
  2. BVoid from the outset because the event involves a third party
  3. CEnforceable only after Ramesh gives notice to Suresh
  4. DNot enforceable unless and until Suresh refuses to buy the lorryCorrect

Explanation

A contract contingent on an uncertain future event happening cannot be enforced unless and until that event has happened. Here the event is Suresh's refusal, which has not yet occurred. It is not void, because the event has not become impossible.

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