A 'condition precedent' in a contract is:
a.A clause requiring arbitration
b.A term that automatically voids the contract
c.An event that must occur before a party's duty to perform arises
d.A promise to pay liquidated damages
Explanation
A condition precedent is an event that must occur before a party becomes obligated to perform. For example, a subcontract may state that the general contractor's duty to pay the sub is conditioned on the general first receiving payment from the owner. Until the condition is satisfied (or excused), the conditioned duty does not arise. It is not an automatic voiding term, a damages clause, or an arbitration provision.
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