Void Agreement:
A void agreement is one that is considered null and has no legal effect from the outset. It is essentially treated as if it never existed. There are several reasons why an agreement may be deemed void:
Illegal Purpose: If the purpose of the agreement is illegal or against public policy, the agreement is void. For example, a contract to commit a crime or violate a law would be void.
Lack of Legal Formalities: Some contracts are required to be in a specific form to be enforceable. If the required legal formalities are not followed, the contract may be void. For instance, certain real estate contracts may need to be in writing.
Agreement with an Uncertain or Impossible Event: If the terms of the agreement involve an event that is impossible or uncertain, the contract may be void. For example, a contract to marry a specific person who is already married would be void.
Consideration or Object Contrary to Law: If the consideration or object of the agreement goes against the law, the contract is void. This could include contracts promoting fraud, harm, or other illegal activities.
Voidable Agreement:
A voidable agreement, on the other hand, is initially valid and enforceable, but one or both parties have the option to void (cancel) it under certain circumstances. The grounds for a contract to be voidable typically involve issues such as:
Lack of Capacity: If one of the parties lacked the legal capacity to enter into the contract (e.g., a minor or someone mentally incapacitated), that party may have the option to void the agreement.
Misrepresentation or Fraud: If one party made false statements or engaged in fraudulent behavior that induced the other party to enter the contract, the defrauded party may have the option to void the agreement.
Coercion or Duress: If one party was forced, threatened, or coerced into entering the contract, the coerced party may have the right to void the agreement.
Undue Influence: If one party, due to a special relationship, exercises undue influence over the other, the influenced party may have the option to void the contract.
Mistake: If both parties were mistaken about a fundamental aspect of the contract, and the mistake was material, the aggrieved party may have the option to void the agreement.
In the case of voidable agreements, the contract remains valid until the party with the right to void chooses to do so. If the aggrieved party doesn't exercise this right within a reasonable time, the contract becomes binding and enforceable.
It's important to note that the distinction between void and voidable agreements may vary based on jurisdiction and local contract laws. Legal advice is recommended when dealing with situations involving void or voidable agreements.