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Condition Subsequent: Definition, Example and Related Terms

What is a Condition Subsequent ?

A 'Condition Subsequent' is a type of condition in a contract, which means something must happen after the deal is done, or else the agreement might change or end.

Imagine you're buying a toy car. Instead of paying straight away, the shopkeeper says you can take it home, but you must pay for it within a week. If you don't pay within that time, the agreement ends and you have to return the toy car. That's a 'Condition Subsequent'. It's something that must happen after the deal is done, otherwise, the deal changes. In business contracts, these conditions are very important as they help protect both sides. If one side doesn't do what they promised, the other side can change the deal or stop it completely.

For example, there may be a contract between two businesses where one business will supply goods and the other will pay for them. The 'Condition Subsequent' could be that if the goods are not delivered by a certain date, the business does not have to pay. This condition protects the business buying the goods, ensuring they are not paying for something they did not receive.

Another example could be a contract for services where the 'Condition Subsequent' is that if the services are not completed to a certain standard, the business hiring the services can terminate the contract. Again, this protects the business hiring the services, ensuring they are getting what they paid for.

These conditions are critical in commercial contracts, ensuring fairness and protection for both parties involved. A contract manager needs to understand 'Condition Subsequent' to ensure the contracts they manage are fair and protect the interests of their business.


  • Scenario Description
    A company contracts a software development agency to create a new piece of software. The contract includes a 'Condition Subsequent' that if the software does not meet the specified requirements, the company can terminate the contract. In this case, the 'Condition Subsequent' protects the company hiring the software development agency. If the software does not meet the required standard, the company can end the contract, ensuring they are not paying for a product that does not meet their needs.
    A business enters into a contract with a supplier to provide materials. The contract contains a 'Condition Subsequent' stating if the materials are not delivered by a particular date, the business can cancel the order without penalty. Here, the 'Condition Subsequent' ensures the business is not obligated to pay for materials that were not delivered on time. This protects the business from financial loss due to delayed or non-delivery.

Related terms