Difference Between Void and Voidable Contract

Difference Between Void and Voidable Contract

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Anshuman
Anshuman Singh
Senior Executive - Content
Updated on Dec 26, 2023 16:05 IST

The main difference between void and voidable contracts is that a void contract is invalid from the time it is created. A voidable contract, on the other hand, remains valid until the dissatisfied party cancels the contract if certain conditions are not met.

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This article will take you through the difference between void and voidable contracts in great detail. But, before we do that, let’s review the list of topics listed under the table of contents (TOC) we will cover in this article.

Table of contents (TOC)

Must read: What are Types of Contract?

Difference between Void and Voidable Contract 

For better understanding, let’s explore the difference between void and voidable contract in a tabular format:

Parameter Void contract Voidable contract
Is it enforceable? No Yes
Which Section of the Indian Contract Act defines it? Section 2 (j) Section 2 (i)
Remain valid However, due to various factors, it has become a void contract since its formation. Stays valid until the aggrieved party cancels the contract.
Can a party sue for loss No Yes
Rights to party No Yes. Only to the aggrieved party.

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What is a Void Contract?

Void contract definition: A void contract is a type of agreement that is null and invalid from its formation or becomes invalid at some point in the future.

A valid contract can also become void at some point in the future. For parties to form a valid contract, the contract must include essential elements such as acceptance and offer, competent contracting parties, lawful consideration, lawful object, and free consent. If any of the contract’s essential elements listed above become impossible later, the contract will be void. Furthermore, once a contract becomes void, it is no longer legally enforceable. Let’s go through an example to understand the term “void contract” in a better way.

Void contract examples:

  • Ankit made a contract with Shubham that he would buy his laptop, and in return, he would give Shubham a packet of Heroin (a highly addictive drug). This contract is void as the product offered is not lawful.
  • Shreya contracted with Riya that she would buy her laptop worth one lakh for ₹20. As Riya is not mentally sound, she happily accepts this contract. But, this contract is void as, according to the Indian Contract Act, a person who is not mentally sound cannot make the contract. Hence, from the start only, this contract was invalid.

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What is a Voidable Contract?

Voidable contract definition: A voidable contract is a type of agreement that can be made void only by one of the parties that made the contract, and this contract is enforceable by law only by that one party.

In a voidable contract, one party is legally empowered to decide whether or not to perform his part. Furthermore, this contract is only valid until the dissatisfied party cancels it. A dissatisfied party may cancel the contract for various reasons, such as all facts not disclosed, misrepresentation or fraud, contractual error, breach of contract, etc. Let’s go through an example to understand the term “voidable contract” in a better way.

Voidable contract examples: 

  • Ankit and Shubham entered into a bailment agreement. According to the contract, Ankit will purchase 100 high-quality sweets from Shubham’s sweet shop for ₹30 per piece. As a result, the total cost of the contract is ₹30,000. Shubham agreed to the contract and sold Ankit 100 pieces of candy. However, half of the sweets were of poor quality. Ankit now has the option to declare the contract null and void because Shubham failed to meet the terms of the agreement.
  • Shreya made a deal with Riya to purchase the laptop for ₹30,000. However, Riya was still a minor when she signed the contract. This is a voidable contract because Riya is unable to communicate. A person who is not a major or has reached 18 cannot make a contract under the Indian Contract Act. As a result, the signed contract will be voidable.

Key Differences Between Void and Voidable Vontract 

Some of the key differences between void and voidable contracts are: 

  • A void contract cannot be enforced by law, whereas a voidable contract can.
  • Voidable contract is defined in Section 2 (I), while void contract is defined in Section 2 (j) of the Indian Contract Act 1872.
  • A void contract is not valid from the beginning, i.e., when it was created. On the other hand, the voidable contract remains in effect until the dissatisfied party fails to revoke it within the specified time limit.
  • In a void contract, neither party can seek damages for non-performance of the contract. On the other hand, the dissatisfied party can seek compensation for any losses.

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Conclusion

To summarise, void contracts are not valid (invalid) from the start, whereas voidable contracts can be cancelled or kept in their current state by one of the parties. And neither party can enforce a void contract, whereas one of the parties, mostly the dissatisfied party, can enforce a voidable contract if they choose.

FAQs

What is the main difference between void and voidable contract?

The main difference between void and voidable contracts is that a void contract is invalid from the time it is created. A voidable contract, on the other hand, remains valid until the dissatisfied party cancels the contract if certain conditions are not met.

In terms of the difference between void and voidable contract, what is a void contract?

In terms of the difference between void and voidable contract, a void contract is a type of agreement that is null and invalid from its formation or becomes invalid at some point in the future.

In terms of the difference between void and voidable contract, what is a voidable contract?

Regarding the difference between void and voidable contract, a voidable contract is a type of agreement that can be made void only by one of the parties that made the contract. This contract is enforceable by law only by that one party.

In terms of the difference between void and voidable contract, which one of these two is enforceable?

Regarding the difference between void and voidable contract, a voidable contract is enforceable.

Regarding the difference between void and voidable contract, which Section of the Indian Contract Act defines void contract?

In terms of the difference between void and voidable contract, a void contract is defined under Section 2 (j) of the Indian Contract Act.

Regarding the difference between void and voidable contract, which Section of the Indian Contract Act defines voidable contract?

In terms of the difference between void and voidable contract, a voidable contract is defined under Section 2 (i) of the Indian Contract Act.

What happens if a contract is void?

If the contract becomes void, it basically is the same as if it never existed. None of the parties can enforce the terms, any property or money exchanged must be returned.

About the Author
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Anshuman Singh
Senior Executive - Content

Anshuman Singh is an accomplished content writer with over three years of experience specializing in cybersecurity, cloud computing, networking, and software testing. Known for his clear, concise, and informative wr... Read Full Bio

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