1. Void and Voidable Contract November 29, 2010
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Void contract Voidable contract
1. A void agreement is void from the
beginning; for this reason it can not be
called as a contract.
A voidable agreement is one, which can be
terminated, i.e., set aside by aggrieved parties to
it. Until it is terminated, it is a good contract.
2. A void agreement confers no right on
any person and creates no obligations
But in case of voidable agreement the rights and
obligations of the parties concerned are present
unless it is cancelled.
3. As a void agreement is not enforceable
from the beginning it is not necessary
for the effected party to declare the
agreement void.
But in case of voidable agreement, contract is
enforceable unless it is cancelled by aggrieved
party.
4 In case of void agreement the party is
not bound to refund the benefit received
to the other party.
But in case of voidable agreement the party may
refund the benefit to the aggrieved party, if the
agreement becomes void later on.
5 A void agreement originates by an
agreement made by a minor, agreements
without consideration, certain
agreements against public policy, illegal
objectives.
A voidable agreement originates by contracts
brought about by coercion, undue influence, and
misrepresentation.
6 The rights obtained by void agreement,
if transferred to a third party, the third
party does not, under any circumstances
obtains a legal title.
In case of voidable agreement, unless the effected
party declared the agreement to be void, the third
party gains legal title for the rights transferred, if
he acts upon good faith.
In which cases a contract can be void?
An agreement is said to be void because of mistake, lack of consideration, want of capacity etc. A list
of void agreements is given below:
1. Lack of capacity.
2. Mutual mistake of fact.
3. Unlawful consideration or object.
4. Consideration or object partly unlawful.
5. Agreements without consideration.
6. Agreements in restraint of trade.
7. Agreements in restraint of legal proceedings.
8. Uncertain Agreement.
9. Agreements by way of wager.
10. Impossible acts.
11. Agreements contingent on impossible event.
12. Reciprocal promises where there are void promises.
13. Agreement is restraint of trade
Example 1: Contract with an idiot is a void contract because there is a lack of capacity.
Example 2: Smuggling contract is a void contract.

2. Void and Voidable Contract November 29, 2010
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What is voidable contract ?
When consent to an agreement is caused by coercion, fraud or misrepresentation, the
agreement is a contract voidable at the option of the party whose consent was so caused. A party
to contract, whose consent was caused by fraud or mispresentation, may, if he thinks fit, insist
that the contract shall be performed, and that he shall be put on the position in which he would
have been if the representations made had been true.
Exception : If such consent was caused by misrepresentation or by silence, fraudulent within the
meaning of section 17, the contract, neverthless, is not voidable, if the party whose consent was
so caused had the means of discovering the truth with ordinary diligence.
Explanation : A fraud or misrepresentation which did not cause the consent to a contract of the
party on whom such fraud was practised, or to whom such misrepresentation was made, does not
render a contract voidable.
Example : A, intending to deceive B, falsely stated that his scooter runs 35 kilometers in one
litre of petrol and thereby induced B to buy the scooter.But actually the scooter runs 24
kilometers in one litre.The contract is voidable at the option of B.
 A void agreement is void from the beginning.
 A voidable agreement is one, which can be avoided / terminated otherwise it is a valid
contract.
 Void ab initio means void from the beginning.

3. Void and Voidable Contract November 29, 2010
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Practice MCQs: Solve these questions and send us back the answers
MCQ’s based on void and voidable contracts:
Q.1. When the consent of a party is obtained by coercion, the contract is
1. Valid
2. Void
3. Voidable
4. Illegal
Q.2 When the consent to an agreement is obtained by undue influence, the agreement is
voidable at the option of
1. either of the parties to the agreement
2. a party whose consent is obtained
3. a party who obtained the consent
4. none of the above
Q.3 S, a seller of imitation jewellery, sells his business to B and promises, not to carry on
business in imitation jewellery and real jewellery. The agreement is –
1. valid with regard to Imitation Jewellery; and void as regards Real Jewellery.
2. void with regard to Imitation Jewellery; and valid as regards Real Jewellery.
3. wholly void
4. fully valid
Q.4 An agreement which restricts a person's freedom to marry or to marry any person
of his choice is against public policy and is –
1. Lawful
2. Illegal
3. Void
4. Enforceable
Q.5 As a general rule minor's agreements are :
1. Void ab initio
2. Voidable
3. Valid
4. Unlawful

4. Void and Voidable Contract November 29, 2010
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Q.6 A contract with resident of an enemy country is :
1. Illegal
2. Void
3. Valid
4. Voidable
Q.7. If time is the essence of a contract and the promisor fails to perform the contract by
the specified time, the contract :
1. Remains Valid
2. Becomes Void
3. Becomes Unenforceable
4. Becomes Voidable at the instance of the promisee