An Agreement is Voidable When It is – Understanding Contract Law
In contract law, an agreement is a legally binding commitment between two or more parties. However, there are certain circumstances in which the agreement may be deemed voidable, which means it can be canceled or rescinded by one of the parties involved. Understanding what makes an agreement voidable is crucial for anyone entering into a contract, whether it be for personal or business reasons.
An agreement is voidable when it is:
1. Made under duress or undue influence
Duress occurs when one party makes a threat or uses force to compel the other party to enter into an agreement. Undue influence, on the other hand, is the use of persuasion or manipulation to coerce someone into entering into an agreement. If an agreement is made under these circumstances, it is considered voidable, as the party who was coerced did not enter into the agreement voluntarily.
2. Made with fraudulent intent
If one of the parties knowingly misrepresents or conceals important information that would affect the other party`s decision to enter into the agreement, the agreement may be considered voidable. Fraudulent intent can include lying, intentionally withholding information, or making a false promise.
3. Made by a minor or someone lacking capacity
Minors and individuals lacking mental capacity are not legally able to enter into contracts. If an agreement is made by someone who falls into one of these categories, it is voidable, and the individual can choose to rescind or cancel the agreement.
4. Against public policy
Lastly, an agreement that goes against public policy is also considered voidable. This can include agreements that promote illegal activity, discrimination, or other unethical practices.
In conclusion, understanding when an agreement is voidable is essential for anyone who enters into a contract. If any of the above factors are present, the agreement can be canceled or rescinded, and individuals have the right to seek legal recourse. It is important to seek the advice of a legal professional before entering into any contract to ensure that it is valid and enforceable.