Legal Definitions - contingent

In legal terms, something is described as contingent when its occurrence or existence depends entirely on an uncertain future event or condition. It means that the outcome is not guaranteed; it will only happen if a specific, often uncertain, prerequisite is met. If that condition is not fulfilled, the contingent event will not take place.

Here are a few examples to illustrate this concept:

• Real Estate Transaction: Imagine a situation where a buyer makes an offer on a house, and the seller accepts it. However, the offer includes a clause stating that the sale is contingent upon the buyer successfully selling their current home within 60 days. This means the house sale is not final or guaranteed. It will only proceed and become binding if the buyer manages to sell their existing property within the specified timeframe. If they fail to sell their home, the contingent condition is not met, and the contract for the new house may be canceled without penalty.

• Business Contract: Consider a software development company that signs a contract with a client. The contract specifies that the final payment of $50,000 is contingent on the software passing a rigorous user acceptance testing (UAT) phase by a certain date. In this scenario, the software company is not guaranteed the full payment. The $50,000 payment is conditional; it will only be released to them if the software successfully passes the UAT, demonstrating it meets the client's requirements. If the software fails the UAT, the contingent condition is not met, and the final payment may be withheld.

• University Scholarship: A university might offer a student a scholarship that is contingent on them maintaining a minimum GPA of 3.5 each semester. The scholarship funds are not unconditionally guaranteed for the student's entire academic career. Instead, the continued receipt of the scholarship is dependent on a specific, ongoing condition – their academic performance. If the student's GPA drops below 3.5 in any given semester, the contingent condition is no longer met, and the university may revoke the scholarship for subsequent semesters.