The difference between void and voidable contracts Is that a void contract is illegal and unenforceable while a voidable contract is legal and the parties can enforce it. A void contract is invalid or entirely against the law, so no one involved can say it’s enforceable under the law. Contracts that are voidable are valid and legally enforceable.

Null and Void

The word void means something isn’t valid and it isn’t legally binding. When we say a contract is void, that means it’s null, void, and that it is not backed by the force of law. That makes it unenforceable, and if anyone breaches an unenforceable contract, the other party to the contract has no legal recourse against them.

A contract can be valid when formed and later become void. This happens when the contract fulfills all the necessary conditions of a valid contract when it’s formed, but the laws change later or something changes to make fulfilling the contract impossible and beyond the capacity of imagination or beyond the control of the involved parties. Then, at that time, it becomes void. The things necessary to establish a valid contract include:

  • Capacity
  • Consideration
  • Lawful object
  • Free consent

What Makes a Contract Voidable

A voidable contract binds one party and the other party has the option to change their mind. This means they can cancel the contract anytime they want. The party that isn’t bound by the contract has the control in this type of contract. A mutual mistake on the part of both parties to a contract makes it voidable. If one or more pieces of material information are omitted from the contract, that also makes it voidable. A contract involving a minor is one example of a voidable agreement.

Minors can enter contracts, but if minors decide to breach the terms of a contract there isn’t any form of legal action that can be taken against them. This makes minors unbound parties in the contract. Another example of an unbound party in a contract is someone who’s either under the influence or someone who isn’t mentally capable of entering into a contractual agreement.

Both void contracts and voidable contracts are forms of legal contracts. A void contract, however, is invalid from the very beginning because it regards an illegal act. A voidable contract becomes invalid when one of parties involved cancels it for legal reasons. Because a void contract is holding against the law, neither party can enforce it. The voidable contract is both legal and valid until canceled or revoked. Starting at the beginning, a void contract can’t be enforced legally.

While no law is in place to support a void contract as a valid, existing contract, at least one party involved can be bound by a voidable contract. Neither obligations nor rights are associated with a void contract. With the voidable contract, which is covered under the law, only one party has the option of whether to continue it or rescind it. Legal liability can’t be assessed on either party to the contract if it’s void, but the voidable contract is upheld until the unbindable party chooses to rescind it.

When a contract is no longer enforceable, it becomes void. When a tactic like coercion, misrepresentation, or fraud are used in establishing a contract, it becomes voidable. A contract that is void can’t be made into a valid contract by two parties agreeing to the contract because you can’t legally agree to do something that’s illegal. A voidable contract, however, can be made valid by the party who isn’t bound, if they agree to give up the right to rescind the contract.

When a contract is ruled void, the court treats it as if it never existed. When a contract is ruled voidable, it can become a void contract based on the conditions that were in place when the contract was formed or it can be avoided under the law. Also, one party, or potentially both, has an option to void the contract. With a void contract, one or both parties have to do something that’s either impossible to do or illegal to do.

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