In recent years, much of the research emphasis in data fusion has shifted to the "higher" levels including Sensor Management;, Situation Assessment and Threat Assessment which rely even more heavily on contingent or rule-based evidence than the lower level. Conditional Event Algebra (CEA) seeks to bring conditionality and contingency under the umbrella of standard probability theory. The basic ideas of Conditional Event Algebra are introduced, in which conditional events are defined as events in the infinite product of the original probability space. As an example, partial firing of rules in experts system is realized by using modus ponens modified by CEA.