(the missing condition is that every hand is beatable)
Each hand beats 2 distinct hands
With 3 distinct hands you can cover up to 6 distinct hands which is a superset of all possible hands
3 * 2 > 5
A --> D | E B --> D | E C --> D | E D --> C | E E --> D | C
A --> B | C B --> C | D C --> D | E D --> E | A E --> A | B
Each hand beats 2 distinct hands
With 3 distinct hands you can cover up to 6 distinct hands which is a superset of all possible hands
3 * 2 > 5