Condition Precedent

Introduction

A condition precedent is a condition that must be fulfilled before a property transfer takes effect. The law does not always require strict (exact) performance of the condition. In some cases, partial or substantial compliance (major fulfilment) is enough.

Meaning / Definition

A condition precedent is a condition that must be satisfied before the interest in property is transferred. Under Section 26, if the condition is valid, the transfer takes effect when the condition is fulfilled. The law applies the rule of substantial compliance (major fulfilment), meaning the condition need not be fulfilled exactly in every detail.

Modes or Types

Strict Fulfillment (exact compliance)

Where the condition must be performed exactly as stated. If not, the transfer will not take effect.

Substantial Compliance (major fulfilment)

Under the doctrine of Cy-pres (as near as possible), if the condition is fulfilled in substance (main requirement is met), the transfer will still take effect.

Important Case Law

Edwards v Hammond

This case established that substantial compliance with a condition precedent is sufficient. Exact performance is not always necessary if the main purpose of the condition is achieved.

Practical Example

A transfers ₹10,000 to B on the condition that B must marry with the consent of C, D, and E.

If E dies, and B marries with the consent of C and D, the condition is treated as fulfilled. This is because of substantial compliance.

However, if all three (C, D, and E) are alive and B marries without their consent, and later they approve (give permission after marriage), the condition is not fulfilled. The approval must exist at the time of marriage.

Summary

• A condition precedent must be fulfilled before transfer takes effect
• Section 26 allows substantial compliance (major fulfilment)
• Exact performance is not always required
• Doctrine of Cy-pres means "as near as possible"
• If the main purpose of the condition is met, transfer is valid
• Later approval (after the act) does not satisfy the condition