Difference / Distinction Between Wagering Contract and Contingent Contract


Wagering Contract

Contingent Contract


Meaning :

           The term ‘wager’ literally means ‘bet’. Wagering Contract is one by which two persons, professing to hold opposite views touching the issue of a future uncertain event mutually agreed dependent upon the determination of the event that one shall win from the other a sum of money, neither of the contracting parties having any other interest”

Meaning :

    ‘Contingent’ means “Something related to possible future and uncertain event”. Contingent Contract is also called as conditional Contract.


Definition :

“Wager” has not been defined in the Indian Contract Act 1872.  Sir William Anson defines “wager” as a promise to give money or money’s worth upon the determination or ascertainment of an uncertain event.

Definition :

        Section 31 of the Indian Contract defines "contingent contract" as a contract to do or not to do something, if some event, collateral to such contract, does or does not happen.


Example :

‘X’ bets with ‘Y’ Rs. 10,000/- that particular Political party come to power. ‘Z’ accepted the same hoping that party would not come into power. It is an agreement by way of wager. In this agreement X cannot sue Y for the amount since it is a wagering agreement and is void.

Example :

     A contracts to pay B Rs. 10,000/- if B's house is burnt. This is a contingent contract.


In wagering, parties may not have any interest in the event except the amount they may win or lose.

In Contingent Contract, the promisor may have some interest in the event.


According to Section 30 of the Indian Contract Act, 1872 wagering agreements are void. In England it is not only void but illegal.

Contingent Contract is Valid and Enforceable by law
In England collateral transactions are void. On the other hand In India collateral transactions are valid because wagering agreements is only void and not illegal.

Collateral transactions are valid.


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