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📄contracts review

Voidable Contracts

Written by the Fiveable Content Team • Last updated September 2025
Written by the Fiveable Content Team • Last updated September 2025

Definition

Voidable contracts are agreements that can be legally enforced but may be rejected by one party due to certain circumstances, such as misrepresentation, duress, undue influence, or a lack of capacity. They allow for the option to either affirm or void the contract, depending on the situation of the parties involved. This flexibility is crucial when interpreting contracts and understanding how they can be affected by external factors.

5 Must Know Facts For Your Next Test

  1. Voidable contracts are valid until one party chooses to void them, giving them a unique status in contract law.
  2. Common reasons for a contract to be voidable include misrepresentation, fraud, undue influence, and lack of capacity.
  3. The party that has the option to void the contract must act promptly; if they wait too long, they may lose their right to void it.
  4. In cases of duress, if a party was compelled to sign under threat or pressure, that contract is typically voidable.
  5. If a voidable contract is affirmed by the aggrieved party, it becomes fully enforceable and cannot later be challenged.

Review Questions

  • How does the presence of misrepresentation affect the enforceability of a contract?
    • Misrepresentation creates a basis for a contract to be voidable because it undermines the consent of the party misled. When one party has been misled about a material fact, they have the right to either affirm the contract or void it. This ensures fairness in contractual agreements by allowing the deceived party to opt-out if they choose.
  • Discuss the implications of capacity on voidable contracts and provide an example.
    • Capacity plays a significant role in determining whether a contract is voidable. For instance, if a minor enters into a contract, that contract is generally considered voidable at the minor's discretion. This means the minor can choose to affirm or void the agreement upon reaching adulthood, protecting those who may not fully understand the implications of their commitments.
  • Evaluate how undue influence can create a scenario for a contract to be considered voidable and what that means for both parties involved.
    • Undue influence occurs when one party exerts excessive pressure on another during contract formation, leading to an imbalance in decision-making power. In such cases, the influenced party may claim that their consent was not genuinely given, rendering the contract voidable. This allows them to seek recourse against exploitation while also highlighting the need for fair dealings between parties in contractual relationships.