A Contract is a legally enforcible agreement, written or oral, which is binding to both of the parties. There are instances where a contract is void, there are also instances where a contract is voidable. These two concepts my look alike but there are minute differences in their application. In this short article, we will discuss the differences between a void and voidable contract in law.
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Meaning of a void contract
A void contract means a contract that is no longer enforceable under the law. It is null and void at face value and cannot be enforced under any federal or state law. There are many situations that can make a contract void. For example, a contract can be void when it goes against public policy or when it is a crime against the state e.g Drug dealing. Accordingly, when a contract is impossible to perform or when it is entered by people of unsound mind, it can also be said to be void.
In the above situations the Contract is declared Void by the court and cancelled entirely. To explain further, i will use the illustration below:
If Mr Sam and Mr Ben enters into a contract that Mr Ben should steal the property of Mr John, in turn for Mr Sam’s payment of the sum of $100,000. That contract is illegal because it is against the law and completely void. In this case, neither parties can enforce it in the court of law.
Nonetheless, it should be noted that, a void contract is different from an unenforceable contract because is a void contract, the contract is not valid so the parties cannot go to court. On the other hand, in an unenforceable contract, the contract is valid but the parties can not take it so court because they refused to carry out their duties under it.
Meaning of a voidable contract
A voidable contract on the other hand is a contract that is valid but can be repudiated by one of the parties involved. This can be because the contract is entered into with a minor or where the contract involves a misrepresentation. It follows that is is valid from inception and can continue to be valid if none of the parties take any step to render it void.
Take for example: If Mr Sam, who is a trader, enters into a contract with John, who is an infant, for the supply cars to John, that contract is voidable according to the law of Nigeria because an infant in Nigeria can only enter into a contract if it is concerned with necessaries. Consequently, John can refuse to perform his part of the contract without any liability on his part according to the law of Nigeria.
Difference between a Void and voidable contract
The main difference between a void and voidable contract is their enforceability in the court of law. A void contract cannot be enforced in any court and is not binding on any of the parties involved, however a voidable contract can be binding. it is only binding on one party represented in the contract and the other party may choose to repudiate the contract.
A good example is a contract between a minor and a buyer and seller of necessaries where the seller is bound to sell the goods according to the contract stipulated, however the minor is not bound because the law deems that he does not have the capacity to enter into contracts.
Therefore he can renege on the contract and declare it void. If the parties decide to perform their parts of the agreement it will continue to be binding on both unlike a void contract that is Void ab into e.g contract for buying and selling hard drugs, there will be no damages should one party fail to perform his own part and both can be punished if the agreement entails a crime. See Everett v Williams.
In conclusion where there is confusion on the nature of a contract it is better or hire a lawyer to iron out the terms and condition of the contract.
Edeh Samuel Chukwuemeka ACMC, is a Law Student and a Certified Mediator/Conciliator in Nigeria. He is also a Developer with knowledge in HTML, CSS, JS, PHP and React Native. Samuel is bent on changing the legal profession by building Web and Mobile Apps that will make legal research a lot easier.