Distinguish between (I) Void and Voidable Contract (Ii) Void Agreement and Illegal Agreement
When it comes to contracts and agreements, it`s essential to understand the legal nuances of each type. Two of the most commonly confused pairs are void and voidable contracts, and void and illegal agreements. In this article, we`ll explain the differences between each of these pairs so you can avoid any legal complications.
Void and Voidable Contracts
A void contract is one that has no legal effect from the beginning. When a contract is deemed void, it is as if it never existed at all. Void contracts are those that are illegal, against public policy, or are impossible to perform legally. For example, a contract to sell stolen property is void as it is against the law.
On the other hand, a voidable contract is one that is legally binding but can be avoided by one or both parties. A contract can be voidable if one of the parties did not have the mental capacity to agree to the terms or if one party was coerced into signing the contract. Other examples of voidable contracts include those that have incomplete terms or those with a mistake in the writing.
The primary difference between a void and voidable contract is that void contracts cannot be enforced by law, whereas voidable contracts can be enforced if the party chooses to do so.
Void and Illegal Agreements
A void agreement is an agreement without consideration or one that violates the law. In this case, it is invalid from the beginning and cannot be enforced by either party. Some examples of void agreements include agreements to commit a crime or to engage in a fraudulent activity.
An illegal agreement is one that is not only void, but also illegal and against public policy. In addition to being unenforceable, an illegal agreement can lead to serious legal consequences for both parties. The most common example of an illegal agreement is a contract to sell illegal drugs.
To summarize, the primary difference between a void agreement and an illegal agreement is that void agreements lack consideration or violate the law, while illegal agreements are not only void but also illegal and against public policy.
In conclusion, understanding the differences between void and voidable contracts, and void and illegal agreements is crucial in protecting oneself from legal complications. By knowing these distinctions, you can avoid entering into agreements that could otherwise have severe legal consequences.