Condition precedent vs condition subsequent at a glance
| Dimension | Condition precedent | Condition subsequent |
|---|---|---|
| What it does | Triggers a duty into existence | Extinguishes a duty already in force |
| State of the obligation | Dormant until the event occurs | Active until the event occurs |
| Timing | The event must happen before performance is owed | The event happens after performance is already owed |
| Effect if the event never occurs | No duty ever arises, so there is nothing to perform | The existing duty simply continues |
| Effect if the event does occur | The duty becomes due and enforceable | The existing duty is discharged and falls away |
| Typical trigger words | ”subject to,” “conditioned upon,” “shall have no obligation unless" | "shall terminate upon,” “the duty ends if,” “unless a claim is brought within” |
| Burden of proof (US default) | The party enforcing the duty proves the condition was satisfied | The party seeking discharge proves the condition occurred |
| Common examples | Financing, regulatory approval, board sign-off, delivery of a certificate | Survival and limitation periods, automatic termination triggers, a right to return goods |
| Frequency in practice | Very common | Rare, and courts presume a condition is precedent when the wording is unclear |
The key differences
When the duty exists
This is the heart of the matter. With a condition precedent, no duty exists yet: the obligation sits dormant and springs to life only once the specified event occurs. A buyer’s promise to close, for instance, may be “subject to” obtaining financing, so until financing lands there is no enforceable duty to close. With a condition subsequent, the duty already exists and is fully owed, and the specified event later cuts it off. The obligation is on by default and the event turns it off.
What the event does
A condition precedent is a switch that turns a duty on, while a condition subsequent is a switch that turns a duty off. That single difference in direction ripples through everything else. Because a condition precedent gates the very existence of the obligation, its non-occurrence means the promisee never had a claim in the first place. Because a condition subsequent removes an obligation that already arose, its occurrence means a valid claim is extinguished going forward rather than never having existed.
The drafting language
The words a drafter chooses usually signal which kind of condition is intended. Language such as “subject to,” “conditioned upon,” “provided that,” or “shall have no obligation unless and until” typically creates a condition precedent, because it holds the duty back until something happens. Language such as “shall terminate upon,” “this obligation ends if,” or “unless suit is brought within twelve months” typically creates a condition subsequent, because it assumes a live duty and describes the event that will end it. Clear, event-specific wording is what keeps a court from having to guess.
Who carries the burden of proof
The classic practical payoff of the distinction is procedural. Under the traditional US rule, the party seeking to enforce a duty must plead and prove that any condition precedent was satisfied, while the party seeking to escape a duty must plead and prove that a condition subsequent occurred. In litigation this decides who bears the risk of an uncertain record. If the relevant event is labeled a condition precedent, the plaintiff who wants performance has to establish it happened; if it is a condition subsequent, the defendant who wants out has to establish it happened.
How courts treat ambiguity
When contract language does not make the choice obvious, US courts tend to construe the provision as a condition precedent rather than a condition subsequent. True conditions subsequent are comparatively rare, and modern authority, including the Restatement (Second) of Contracts, largely reframes them as events that terminate a duty rather than as a separate species of condition. The practical lesson is that if you want an event to end an existing obligation, you should say so in unmistakable terms rather than rely on the label.
Practical examples
Conditions precedent dominate deal-making. A financing contingency, a regulatory or antitrust approval, board or shareholder sign-off, receipt of a legal opinion, and delivery of a closing certificate are all events that must occur before the duty to close or to pay arises. Conditions subsequent are narrower but real. A survival clause that discharges an indemnity if no claim is brought within eighteen months, a policy term that ends coverage on a stated event, or a supply term that lets a buyer return nonconforming goods and cancel the balance of the order each operate to switch off a duty that already existed.
Which one to use, and when
You rarely get to pick a label in the abstract; you decide what you want the event to do, and the label follows. Ask whether you want the event to bring an obligation into being or to end one that is already in force.
Use a condition precedent when a party should owe nothing until a specific thing happens. This is the right structure for gating a closing, a funding, or a first performance on approvals, inspections, or third-party consents. Because the duty stays dormant, the party who benefits from the condition is protected from ever being on the hook if the event fails, and the party who wants performance carries the burden of showing the event occurred. Draft it with holding-back language (“Buyer shall have no obligation to close unless and until…”) and spell out exactly what satisfies the condition and who decides.
Use a condition subsequent when a duty should exist now but end automatically on a later event. This fits survival and limitation windows, sunset provisions, and automatic termination triggers where you want an obligation to be live and enforceable in the meantime. Keep in mind that you are the one who will have to prove the terminating event, and that a court may read an unclear clause as a condition precedent instead, so precision matters even more here. State the live duty, then state the event that ends it in words that cannot be mistaken for a mere precondition.
For teams managing many agreements, the risk is not understanding the doctrine but tracking every condition across a portfolio and catching the deadline that discharges or triggers a duty. A contract lifecycle management platform such as Pactolane keeps each agreement in a single repository with renewal and deadline alerts, so a survival window or an approval milestone does not slip by unnoticed. PactAI can support the review by extracting conditional language across a contract, flagging clauses that gate or terminate obligations, and scoring the exposure from 0 to 100, while a human still decides how each condition should be worded and met.
The decision rule
Ask one question: do you want the event to start a duty or to end one? If you want a party to owe nothing until something specific happens, write a condition precedent, use holding-back language, and remember that the party seeking performance must prove the event occurred. If you want a duty to be live now but to fall away on a later event, write a condition subsequent, describe the terminating event in unmistakable terms, and remember that you will bear the burden of proving it and that ambiguous wording will likely be read as a precedent instead. When large sums, insurance coverage, or survival periods turn on the classification, confirm the governing state’s rule with qualified counsel before you rely on it.
General legal information, not legal advice.
The pages compared here
Read each concept in full.
Frequently asked questions
What is the difference between a condition precedent and a condition subsequent?
A condition precedent must occur before a contractual duty arises, while a condition subsequent discharges a duty that already exists. The precedent switches an obligation on, and the subsequent switches it off. Because the precedent gates whether the duty ever starts and the subsequent ends a duty already owed, the label changes both the timing of performance and which side has to prove the triggering event.
Who has the burden of proving a condition precedent or a condition subsequent?
Under the traditional US rule, the party enforcing a duty must prove that any condition precedent was satisfied, while the party seeking to escape a duty must prove that a condition subsequent occurred. That allocation decides who bears the risk of an uncertain record in litigation. It is one of the main practical reasons the classification matters.
Is a financing contingency a condition precedent or a condition subsequent?
A financing contingency is almost always a condition precedent, because the buyer owes no duty to close until financing is obtained. If the financing never comes through, the duty to close never arises and the buyer generally walks away without breaching. Drafters usually reinforce this with language such as "subject to" or "conditioned upon" financing.
What happens if a condition precedent is not met?
If a condition precedent is not met, the duty it was guarding never comes into existence, so there is nothing to perform and no breach for failing to perform. The party who would have benefited from that performance simply has no enforceable claim. Depending on the wording and governing law, the parties may still owe good-faith efforts to try to satisfy the condition.
Why do courts usually read an ambiguous condition as precedent?
When contract language is ambiguous, US courts tend to construe a provision as a condition precedent rather than a condition subsequent. True conditions subsequent are rare, and modern authority often reframes them as events that terminate a duty rather than as a distinct kind of condition. The practical takeaway is that a drafter who wants an event to end an existing obligation should say so in unmistakable terms.
On the same topic
Other pages closely related to this one.