Agreement of Voidable Contract: Understanding the Basics

In the world of business, contracts are essential agreements between parties that help ensure that everyone involved is on the same page. However, not all contracts are created equal. Some are voidable contracts, meaning that one or both parties have the option to void or cancel the contract. In this article, we will discuss what a voidable contract is, the differences between voidable and void contracts, and the agreement of a voidable contract.

What is a Voidable Contract?

A voidable contract is a legal agreement that can be canceled by one or both parties involved. This type of contract is different from a void contract, which is an agreement that has no legal effect from the beginning. A voidable contract is usually valid at the time it is created, but it can be canceled or terminated if one or both parties decide to do so.

Voidable contracts can arise from a variety of reasons. One common reason is when one party is coerced, unduly influenced, or misled into entering into the agreement. Another reason could be when one party is deemed incapable of understanding what they are agreeing to. In these situations, the party who was coerced, unduly influenced, misled or incapable of understanding has the option to void the contract.

Differences between Void and Voidable Contracts

A void contract is a contract that is invalid from the beginning. It may be invalid because it lacked an essential element such as consideration, legality, or capacity. In contrast, a voidable contract is legally enforceable and binding when it is written, but it can be canceled by one or both of the parties involved. A void contract is considered null and void, whereas a voidable contract is subject to being canceled.

Agreement of a Voidable Contract

The agreement of the voidable contract is an important concept to understand. The agreement of a voidable contract means that both parties initially agreed to the terms and conditions of the contract when they entered into it. However, one or both parties can subsequently decide to void the contract before it has been fully performed. For example, if one party entered into a contract due to coercion or undue influence, they can void the contract by providing evidence of this fact.

To prevent disputes and issues from arising, it is important that both parties fully understand the terms and conditions of the contract before agreeing to it. Additionally, both parties should seek legal advice to ensure that the agreement is legally binding and valid. This will help to avoid any misunderstandings, disputes, or legal issues that may arise in the future.

Conclusion

In conclusion, a voidable contract is an agreement that can be canceled by one or both parties. The agreement of a voidable contract means that both parties initially agreed to the terms and conditions of the contract when they entered into it. However, one or both parties can subsequently decide to void the contract before it has been fully performed. To ensure that both parties are on the same page, it is important to fully understand the terms and conditions of the contract before agreeing to it. When in doubt, it is always advisable to seek legal advice before entering into any contractual agreements.