A condition is a requirement or limitation involved in a contract, trust, law, or other legally recognized document that changes the rights and duties of those involved. Contracts often have numerous conditions which set out the parameters of the agreement, and if one party does not fulfill or follow a condition, the other party may have a right to damages or to terminate the agreement. Trusts often use conditions to control how the assets are to be delegated based upon the wishes of the grantor. Examples of conditions:
- Pear Inc. and ABC Building Co. enter into a contract where Pear Inc. will provide specialized glass to ABC Building Co. upon the condition that ABC Building Co. keeps the contract a secret.
- Sarah bequests to each of her children $50,000 upon the condition that each child finishes college.
[Last updated in June of 2021 by the Wex Definitions Team]