Void, Valid, Voidable, and Unenforceable Contracts

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What is a void contract?

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A void contract is not legally binding because it lacks essential elements or violates the law.

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What are the characteristics of a void contract?

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Cannot be enforced by any party. Void contracts often arise when the purpose is illegal or one of the essential elements (agreement, consideration, capacity, legal purpose) is missing.

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Give an example of a void contract.

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A contract to commit a crime or a contract made by a person legally declared insane.

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What is a voidable contract?

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A voidable contract is initially valid and enforceable but one party has the right to rescind it.

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What are the characteristics of a voidable contract?

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Can be enforced if the affected party chooses not to void or rescind it. Often occurs in cases of coercion, misrepresentation, fraud, or when a party lacks proper legal capacity.

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Give an example of a voidable contract.

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A contract entered into by a non-emancipated minor or an agreement signed under some form of duress.

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What is a valid contract?

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A valid contract meets all legal requirements and is enforceable in court.

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What are the characteristics of a valid contract?

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Requires Agreement, Consideration, Legal Purpose, and the proper capacity of all relevant parties. Represents a clear agreement between competent parties.

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Give an example of a valid contract.

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A signed employment agreement or a lease for an apartment or home.

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What is an unenforceable contract?

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An unenforceable contract has all the legal elements of a valid contract but cannot be enforced due to specific legal defenses or issues.