What Contracts Are Voidable

Contracts essentially bind two or more parties in an agreement, obligating them to fulfill certain terms and conditions. However, in some instances, a contract can be voidable, which means that one or more parties have the right to annul or cancel the agreement. Contracts may be voidable due to several factors such as misinterpretation, fraud, coercion or mistakes. It is essential to have a good understanding of what constitutes a voidable contract to ensure that your rights and interests are protected. In this article, we will discuss what contracts are voidable and under what circumstances.

1. Misrepresentation:

A misrepresentation occurs when one party makes a false statement or conceals the truth that influences the other party while entering into a contract. If a contract is voidable on the grounds of misrepresentation, the affected party has the right to cancel the contract or seek damages. It is essential to note that for a claim of misrepresentation to be valid, the statement must have been made willingly and with intent.

2. Mistake:

A mistake occurs when one or more parties to a contract have misunderstood the terms or have made an error while entering into the agreement. A mistake can be unilateral, which means that one party made an error, or mutual, which means that both parties made a mistake. If a contract is voidable on the grounds of a mistake, the affected party has the right to cancel the agreement.

3. Coercion:

Coercion occurs when one party forces the other party to enter into an agreement by making threats or using force. Coercion may also involve the threat of damage to property or reputation. If a contract is voidable on the grounds of coercion, the affected party has the right to cancel the agreement or seek damages.

4. Duress:

Duress occurs when one party compels the other party to enter into an agreement under threat of harm or violence. Duress can be physical or emotional, and it is an illegal way of entering into an agreement. If a contract is voidable on the grounds of duress, the affected party has the right to cancel the agreement.

5. Undue Influence:

Undue influence occurs when one party uses their position of power to influence the other party to enter into an agreement. This can involve physical, emotional, or psychological pressure. If a contract is voidable on the grounds of undue influence, the affected party has the right to cancel the agreement.

6. Incapacity:

Incapacity occurs when one or more parties to a contract do not have the legal capacity to enter into an agreement. This can include minors, people who are under the influence of drugs or alcohol, and mentally impaired individuals. If a contract is voidable on the grounds of incapacity, the affected party has the right to cancel the agreement.

Conclusion:

In conclusion, a contract can be voidable on several grounds, including misrepresentation, mistake, coercion, duress, undue influence, and incapacity. It is essential to understand the circumstances under which a contract can be voided to protect your interests. If you believe that a contract you entered into is voidable, it is advisable to seek legal advice to ensure that your rights are protected.