A voidable agreement is a formal agreement between two parties that may be rendered, unenforceable for a number of legal reasons. Reasons that can make a contract voidable include failure by one or both parties to disclose a material fact; a mistake, misrepresentation or fraud; undue influence or duress; one party’s legal incapacity to enter a contract; one or more terms that are unconscionable; or a breach of contract. They are valid agreements, but one or both of the parties to the contract can void the contract at any time.
It is a formal agreement between two parties that may be rendered unenforceable for a number of legal reasons. It is usually only one of the two parties who would be adversely affected by agreeing to a voidable contract if they had recognized the misrepresentation or fraud made by the other party.
A contract can be deemed voidable if:
- The contract includes misrepresentation, errors, or fraudulent statements.
- The contract was signed under duress or undue influence.
- One or both parties could not legally enter into a contract.
- The contract contains one or more unconscionable terms.
- Breach of contract occurs.
It is originally considered to be legal and enforceable but can be rejected by one party if the contract is discovered to have defects. For example, the first party would not have agreed to the contract originally and has the opportunity to reject it after the fact. In Contrast, a void contract is inherently unenforceable. An example would be a contract that violates the law, such as a murder for hire Contract.