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”According to Section 30 of the Indian Contract Act, 1872 wagering agreements are void. In England, it is not only void but illegal.
Definition of Wagering Contract
“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.
Example :
‘X’ bets with ‘Y’ Rs. 10,000/- that particular Political party comes to power. ‘Z’ accepted the same hoping that party would not come into power. It is an agreement by way of a wager. In this agreement, X cannot sue Y for the amount since it is a wagering agreement and is void.
Essentials of Wagering agreement:
The essentials of a wagering agreement are as follows -
(1) The parties have opposite views regarding an uncertain event.
(2) There are chances of gain or loss to the parties on the determination of the event one way or the other.
(3) The parties have no other interest except winning or losing of bet
(1) Uncertain Event:
According to Anson, "An event may be uncertain not only because it is a future event, but because it is not yet ascertained at any rate to the knowledge of the parties". According to Cheshire and Fifoot, Its limitation to a future uncertain event is incorrect, for a wager is nonetheless a wager though it concerns the past or present fact or event.
(2) Chance of Gain or Loss:
There should be a chance of anyone Party winning and the other closing on the determination of the event one way or the other. If there is no such mutual chance of Gain or loss there is no wager.
(3) No other Interest in the Event:
Neither party should have any interest in the happening of the event other than the sum of as stake he will win or loss. The object of the wager is to make a gain purely as the decision of an uncertain event. One party backs his knowledge skill or luck against that of the other, and in a true wager, this is the whole transaction.
See also:
1) Distinction Between Wagering Agreement and Insurance Contract
2) Distinction Between Wagering Contract and Contingent Contract
3) Types of Agreement (The Indian Contract Act, 1872)
4) Who may obtain Specific Performance?
5) Essential Elements of Contract of Sale
Definition of Wagering Contract
“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.
Example :
‘X’ bets with ‘Y’ Rs. 10,000/- that particular Political party comes to power. ‘Z’ accepted the same hoping that party would not come into power. It is an agreement by way of a wager. In this agreement, X cannot sue Y for the amount since it is a wagering agreement and is void.
Essentials of Wagering agreement:
The essentials of a wagering agreement are as follows -
(1) The parties have opposite views regarding an uncertain event.
(2) There are chances of gain or loss to the parties on the determination of the event one way or the other.
(3) The parties have no other interest except winning or losing of bet
(1) Uncertain Event:
According to Anson, "An event may be uncertain not only because it is a future event, but because it is not yet ascertained at any rate to the knowledge of the parties". According to Cheshire and Fifoot, Its limitation to a future uncertain event is incorrect, for a wager is nonetheless a wager though it concerns the past or present fact or event.
(2) Chance of Gain or Loss:
There should be a chance of anyone Party winning and the other closing on the determination of the event one way or the other. If there is no such mutual chance of Gain or loss there is no wager.
(3) No other Interest in the Event:
Neither party should have any interest in the happening of the event other than the sum of as stake he will win or loss. The object of the wager is to make a gain purely as the decision of an uncertain event. One party backs his knowledge skill or luck against that of the other, and in a true wager, this is the whole transaction.
See also:
1) Distinction Between Wagering Agreement and Insurance Contract
2) Distinction Between Wagering Contract and Contingent Contract
3) Types of Agreement (The Indian Contract Act, 1872)
4) Who may obtain Specific Performance?
5) Essential Elements of Contract of Sale
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