Understanding the Differences: Void Agreements and Voidable Contracts

In the legal realm, there are various terms and concepts that are often used interchangeably but hold distinct meanings. Two such terms are “void agreement” and “voidable contract.” While they may sound similar, understanding their differences is crucial to navigating the legal landscape effectively.

A void agreement refers to a contract that lacks enforceability from the very beginning due to its illegality or mutual mistake. Essentially, it is as if the agreement never existed in the eyes of the law. On the other hand, a voidable contract is a valid agreement that can be either affirmed or rejected by one or more parties involved.

Let’s take a closer look at each term:

Void Agreement

A void agreement is essentially considered null and void from its inception. It is unenforceable, meaning that neither party can claim any rights or obligations arising from it. This can occur due to the contract being:

• Against the law
• Against public policy
• Obtained through fraud, duress, or undue influence

For instance, if two parties enter into an agreement to engage in illegal activities, such as drug trafficking, that agreement would be considered void. Additionally, if a contract violates laws protecting consumers or employee rights, it would also fall under the category of a void agreement.

Voidable Contract

Unlike a void agreement, a voidable contract is initially valid and enforceable. However, one or more parties have the option to either affirm or reject the contract due to certain circumstances. These circumstances can include:

• Misrepresentation of facts
• Undue influence
• Coercion
• Fraud
• Mistake

An example of a voidable contract is when one party enters into an agreement based on false information provided by the other party. The deceived party has the right to either proceed with the contract or rescind it based on the misinformation.

Understanding the difference between void agreements and voidable contracts is important when entering into legal arrangements. Contractual obligations and legal rights can vary significantly depending on the nature of the agreement, whether it is void or voidable.

To further explore the topic of legal agreements, you may find the following resources valuable:

• Room Agreement Process
• Local 2724 Collective Agreement
• Residential Tenancy Rental Agreement Saskatchewan
• Difference Between Contractor Safety and Consultant Safety Inspector
• Agreement for Sale Possession
• Sample Contract for Selling a Car Privately
• Sears Tooth Agreement Precedent