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A Contingency Contract links payment or performance to specific future events or conditions. Under Swiss law, these agreements let parties move forward when they can't fully predict outcomes - like success fees in M&A deals or performance bonuses tied to sales targets.

Swiss courts enforce these contracts when the triggering conditions are clear and measurable. The key is that both parties must agree upfront on exactly what needs to happen for the contract to take effect. Common examples include construction completion dates, reaching revenue milestones, or obtaining regulatory approvals. The Swiss Code of Obligations requires these conditions to be possible and legal.

Use a Contingency Contract when you need to tie business outcomes to specific future events. These agreements work especially well for Swiss mergers and acquisitions, where success fees depend on closing deals, or in construction projects where payments link to completion milestones.

This contract type proves invaluable when managing complex transactions with uncertain outcomes. It helps protect both parties by clearly defining triggers for payment or performance. Common scenarios include real estate developments awaiting permits, startup funding rounds tied to growth metrics, or consulting engagements where fees depend on achieving cost savings. Swiss law enforces these agreements as long as the conditions remain specific and measurable.

• Performance-Based: Ties payments to specific measurable outcomes like sales targets or cost savings in Swiss business contracts
• Time-Dependent: Links obligations to future dates or milestones, common in construction and development projects
• Regulatory: Bases contract execution on obtaining specific permits, approvals, or licenses from Swiss authorities
• Event-Triggered: Activates when specific business events occur, such as successful mergers or property sales
• Multi-Stage: Structures payments or deliverables across several predetermined conditions, popular in complex commercial deals

• Business Owners: Use Contingency Contracts to structure deals with variable outcomes, especially in mergers and acquisitions
• Real Estate Developers: Link payments to construction milestones or regulatory approvals for major projects
• Investment Firms: Structure success fees and performance-based compensation in Swiss financial transactions
• Legal Counsel: Draft and review agreements to ensure compliance with Swiss contract law and protect client interests
• Management Teams: Implement performance-based incentives and bonus structures tied to specific business goals

• Define Triggers: List all specific conditions or events that will activate contract obligations
• Gather Details: Document full party information, timelines, and exact performance metrics
• Set Measurements: Establish clear methods to verify when conditions are met
• Payment Terms: Outline precise payment amounts, schedules, and any variable components
• Verification Process: Specify how and who will confirm condition fulfillment
• Dispute Resolution: Include Swiss-compliant arbitration or mediation procedures
• Documentation: Plan how evidence of meeting conditions will be recorded and shared

• Parties: Full legal names and addresses of all involved entities under Swiss law
• Trigger Conditions: Precise description of events or circumstances that activate obligations
• Performance Terms: Clear outline of actions required when conditions are met
• Timeline: Specific dates or periods for condition fulfillment and performance
• Verification Method: Agreed process for confirming conditions have been met
• Governing Law: Express choice of Swiss law and jurisdiction
• Dispute Resolution: Swiss-compliant arbitration or court proceedings provisions
• Termination Rights: Circumstances allowing contract cancellation or modification

A Contingency Contract differs significantly from a Contingency Fee Agreement in Swiss legal practice. While both involve conditional elements, their purposes and applications vary substantially.

• Scope and Purpose: Contingency Contracts cover any business condition or milestone, while Contingency Fee Agreements specifically govern attorney compensation based on case outcomes
• Payment Structure: Contingency Contracts can involve multiple payment triggers and varied amounts, whereas Fee Agreements typically set a fixed percentage of recovery
• Industry Application: Contingency Contracts appear across sectors like real estate, manufacturing, and M&A, while Fee Agreements are limited to legal services
• Risk Distribution: Fee Agreements shift financial risk primarily to the attorney, while Contingency Contracts often balance risk between both parties