VOID AGREEMENT, VOID CONTRACT AND VOIDABLE CONTRACT
Contracts are an integral part of our daily lives, governing various transactions and agreements. However, not all contracts are legally enforceable. In this blog post, we will delve into the provisions of the Contract Act, exploring the distinctions between void agreements, void contracts, and voidable contracts.
Here are the detailed provisions of void agreements, void contracts, and voidable contracts as mentioned under the Indian Contract Act :
- Void Agreements {Sections 2(g)} : A void agreement is one that has no legal effect from the beginning and is not enforceable by law. Void agreement as an agreement that is expressly declared void by law.
- Void Contracts {Section 2(j)} : A void contract is a contract that lacks the essential elements required to make it legally binding from the beginning. Void contract as a contract that is void ab initio, meaning it is void from the start and has no legal effect.
- Voidable Contracts {Section 2(i)} : A voidable contract is a valid contract, but it gives one or both parties the option to either enforce it or declare it void. Voidable contract is one, that is enforceable by law at the option of one or more parties but not at the option of the other party.
VOID AGREEMENTS –
Void agreements, as defined in the Contract Act, are those that have no legal effect from the beginning, meaning they are considered null and void. These agreements lack enforceability and cannot be enforced by any party involved. It is as if the contract never existed.
EXAMPLES OF VOID AGREEMENTS –
- Agreement made by a minor (a person under the age of 18 years), as they lack the legal capacity to enter into a contract.
- Agreement without lawful consideration, where the contract lacks a lawful object or consideration.
- Agreement with a mutual mistake of fact, where both parties are mistaken about a fundamental aspect of the contract.
VOID CONTRACTS –
Void contracts are different from void agreements, as they may have initially been valid but become void due to subsequent events or circumstances. These contracts are considered void ab initio (from the beginning) and are treated as if they never existed.
EXAMPLES OF VOID CONTRACT –
- Contract with unlawful consideration or object, such as engaging in illegal activities or violating public policy.
- Contract with the involvement of a person declared mentally incompetent by a court of law.
- Contract based on a fraudulent representation, where one party intentionally misrepresents facts to deceive the other party.
VOIDABLE CONTRACT –
Unlike void agreements and void contracts, voidable contracts have the potential to be enforced if the aggrieved party chooses to do so. These contracts are initially valid but can be voided at the option of one of the parties due to certain legal deficiencies or circumstances.
EXAMPLES OF VOIDABLE CONTRACT –
- Contract entered into under coercion, undue influence, or fraud, where one party is forced or tricked into entering the agreement against their free will.
- Contract with a minor, which can be voided by the minor upon reaching the age of majority.
- Contract with a person of unsound mind, which can be voidable if the person is capable of understanding the consequences and opts to void it.
Understanding the distinctions among void agreements, void contracts, and voidable contracts is crucial when navigating the legal landscape. While void agreements lack enforceability from the beginning, void contracts are rendered null due to subsequent events. On the other hand, voidable contracts can be enforced unless one of the parties chooses to void them based on legal deficiencies.
REFERENCES :
- https://indiankanoon.org/docfragment/82394326/?formInput=cases%20on%20void%20agreement – INDIAN KANOON
- https://main.sci.gov.in/jonew/judis/6228.pdf – SUPREME COURT OF INDIA
