Its feels awkward while answering my own question but as I solve it myself so posting because it may help someone else.
<script type="text/javascript">
//< ![C
Validation.add('conditional-required', 'This is a required field.', function(v) {
var type = $('type').getValue();
if(type == 'Other')
{
return ( (v != "none") && (v != null) && (v.length != 0));
}
else
{
return true;
}
});
//]]>
</script>
Add id type
to dropdown list
<select name="type" class="required-entry" id="type">
Add class conditional-required
to text field
<input type="text" value="" name="price" class="conditional-required">
Fairly Simple!