condition

Contract LawLegal glossary term

Legal Definition

A condition is a provision in a contract or legal instrument that makes the existence of a duty or the performance of an obligation dependent upon the occurrence or non-occurrence of a specified future event. If the condition is not satisfied, the party whose performance was conditioned is typically excused from that obligation.

Plain-English Translation

Think of a condition like a rule in a game that says 'you only get the prize if you finish the race.' In law, it is a requirement that must happen before someone is officially forced to do what they promised, like paying money or delivering goods.

Context in Contracts

It allows parties to manage risk by ensuring they are not obligated to perform their side of a bargain unless specific requirements or external events are met.

Visual model

Understand condition fast

ELI10 illustration for condition
01

A buyer's obligation to purchase a house is conditioned on the property passing a professional inspection.

02

An insurance company's duty to pay a claim is conditioned on the insured providing timely notice of the loss.

Document context

How condition shows up in legal documents

What is it?

A legal requirement or event that must occur before a contractual duty becomes binding or before a right is triggered.

Why does it matter?

It allows parties to manage risk by ensuring they are not obligated to perform their side of a bargain unless specific requirements or external events are met.

When does it matter?

It matters when determining if a party is in breach of contract or if their performance obligations have been legally suspended or terminated.

Where is it usually seen?

Found in commercial contracts, real estate purchase agreements, insurance policies, and testamentary trusts.

Who is affected?

Contracting parties, beneficiaries of trusts, and insurance policyholders.

How does it work?

It functions as a gatekeeper; if the condition precedent is not met, the duty to perform never arises, whereas a condition subsequent can discharge an existing duty.

Related terms

Terms to compare with condition

Covenant

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Knowledge graph

Where condition connects to real contract work

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Disclaimer: We do not provide legal advice. We translate legal language into plain English and help you prepare for a conversation with a lawyer.