When entering into a contractual agreement, it is important to understand the terms and conditions outlined in the agreement. Two terms that are often used interchangeably but have very different meanings are “void” and “voidable” contracts.
A void contract is a contract that is considered invalid from the beginning or has no legal force. This type of contract is often created when the contract is against the law, public policy, or is fraudulent. For example, if a person agrees to sell illegal drugs to another person, the contract is void and unenforceable in court.
On the other hand, a voidable contract is a contract that is valid but can be avoided or cancelled at the option of one or both parties. The circumstances that make a contract voidable include improper influence or coercion, fraud, misrepresentation, or a mistake. For instance, if a person is pressured into signing a contract without understanding its terms, the contract is voidable.
It is important to note that a void contract cannot be ratified or made valid through subsequent agreement or conduct, while a voidable contract can be affirmed or ratified by the parties involved.
In summary, a void contract is considered invalid and has no legal force, while a voidable contract is considered valid but can be avoided or canceled under certain circumstances. Understanding these differences is crucial when entering into a contractual agreement and can help to avoid potential legal disputes.