contingent interest

Under s.21 of the Transfer of Property Act, where an interest is created to take effect only on the happening of an uncertain event, or if it does not happen, the transferee gets a contingent interest. It becomes vested when the condition is fulfilled.

Contrast a vested interest (s.19): a present right, even if enjoyment is postponed, which is not defeated by the transferee's death before he takes possession. A contingent interest may never take effect. An exception in s.21: where a person is to take on reaching a certain age and is also given the income absolutely in the meantime, his interest is vested. A contingent interest can be transferred, unlike a mere chance of succession.

Example

A gift of the house “to B if she qualifies as an advocate” gives B only a contingent interest until she enrols.

In Indian law

• Sections 19 and 21, Transfer of Property Act, 1882

See also

vested interest · spes successionis · rule against perpetuity

Read more in the study notes

• Modes of execution: arrest and detention, attachment, and sale (Civil Procedure Code and Limitation Act)
• Reference, review and revision; caveat, restitution and the inherent powers of the court (Civil Procedure Code and Limitation Act)
• Void agreements and legality of object (Contract I)
• Contingent contracts (Contract I)
• Frustration and impossibility of performance (Contract I)
• Breach of contract: anticipatory and actual (Contract I)